Do Kwon
Do Kwon (born 1991, Seoul) is the co-founder of Terraform Labs and the creator of the Terra/LUNA ecosystem, which included the LUNA token and UST — an algorithmic stablecoin designed to maintain its $1 peg through a mint-and-burn mechanism with LUNA. LUNA reached a peak market cap of ~$40B in early 2022 before collapsing to near-zero in May 2022, wiping out an estimated $40–60B in market value and triggering broader crypto contagion.
The collapse mechanism: UST was backed by LUNA redemption bids rather than hard collateral. When sell pressure on UST exceeded available LUNA bid-side liquidity, a death spiral began — UST holders redeemed for LUNA to sell for real dollars, the redemption queue grew, LUNA price fell further, which made the queue grow more. By May 2022, $10B in UST was trying to redeem against a bid structure far thinner than in the 2021 stress test.
Do Kwon had publicly accepted a $10M bet from GCR in March 2022 that LUNA would be lower within one year. GCR supplemented with $10M in perpetual shorts. Total short position of $20M was covered for $0.72 when LUNA went to zero.
Do Kwon was arrested in Montenegro in March 2023 and extradited to South Korea in 2024 to face fraud charges.