A hearing in Manhattan today saw Do Kwon, co-founder of Terraform Labs, deny the accusations linked to the collapse of TerraUSD.

Do Kwon, Co-Founder The co-founder of Terraform Labs pleaded not guilty to criminal fraud charges in federal court in Manhattan on Thursday after his extradition from Montenegro, according to the British Daily Mail. Reuters.

Charges stem From his turn In the collapse of the cryptocurrencies TerraUSD and Luna, wiping out an estimated $40 billion in market value in 2022.

Do Kwon "misled" investors

Federal prosecutors allege that Kwon Misleading investors about the stability of TerraUSD, claiming in 2021 that its value was maintained through a special algorithm. Prosecutors contend that Kwon secretly used a high-frequency trading firm to artificially maintain the stablecoin's peg to one dollar, according to Reuters.

The indictment includes charges of securities fraud, commodity fraud, wire fraud, conspiracy, and money laundering.

The charges come on the heels of a turbulent year for Kwon, who fled after the collapse of the Terra blockchain led to a wave of bankruptcies. Including high-profile companies Like Three Capital Arrows.

Interpol Issued Red notice issued for his arrest, he was arrested in Montenegro in March 2024 while trying to board a plane with fake passports.

Recently Minister of Justice of Montenegro consent Kwon's extradition to the United States, ending months of... Legal controversy between The United States and South Korea, both of which sought to prosecute him. Although Kwon now faces major legal challenges in the United States, South Korean authorities are continuing their investigations, which could result in him being sentenced to 40 years in prison if convicted.

Kwon's next court appearance is expected to outline further proceedings. His case remains a major topic in discussions about accountability in the cryptocurrency industry.