Terra/Luna
Last changed 2026-10-27 · Score recalculated — Rescored under Scoring v2, the published formula (avoid.net/scoring): 2 → 0. Problems weighed by who is responsible: the subject's own conduct −180, concerns that are not fraud −33.2; legitimacy credit long-running +10; 1 section(s) set aside until a failed fact-check is resolved. Version history →
Why this score
| Every page starts at | 65 |
| The subject's own conduct | -180 |
| Concerns that are not fraud | -33.2 |
| Long-running | +10 |
| Sum | -138 |
- 1 section set aside: the claims did not hold up in a fact-check, pending correction.
Score: 0/100 (kept between 0 and 100)
How scoring works →Summary
Terra was a blockchain protocol developed by Terraform Labs that operated an algorithmic stablecoin (TerraUSD/UST) pegged to the US dollar via a mint-and-burn mechanism with its native token LUNA. In May 2022, UST lost its dollar peg and entered a catastrophic death spiral that wiped out approximately $40-45 billion in market capitalization within days, triggering cascading bankruptcies across the crypto industry. Founder Do Kwon was subsequently charged with fraud by the SEC and DOJ, found liable at trial, and sentenced to 15 years in federal prison in December 2025 — with Terraform Labs agreeing to a $4.47 billion SEC settlement, the largest in SEC crypto enforcement history at the time.
Connected Entities
17 entities · 60 linked investigations- Do Kwon→member of→luna(95%)
- Han Chang-joon→member of→luna(85%)
- Luna Foundation Guard→subsidiary of→luna(90%)
- Do Kwon→controls→Terraform Labs(95%)
- Do Kwon→member of→Terra/Luna(95%)
- Daniel Shin→member of→Terra/Luna(90%)
- Han Chang-joon→member of→Terra/Luna(85%)
- Luna Foundation Guard→subsidiary of→Terra/Luna(90%)
- Chai Corporation→associated with→Terra/Luna(80%)
- Daniel Shin→controls→Chai Corporation(75%)
- + 64 more
Connected Through
15 shared actors · 548 investigationsDistinct actors this investigation shares with others — holders, traders, and named parties. Shared infrastructure (exchanges, pools) is excluded.
- ♦Bitcointoken
- □Tetherorganization
- □Terra/Lunaorganization
- □Three Arrows Capitalorganization
Timeline(30 events)
2018
Do Kwon and Daniel Shin co-found Terraform Labs in Singapore.
2019
Terra blockchain launches with the LUNA token.
September 2020
Anchor Protocol launches, offering approximately 19.5% APY on UST deposits.
May 2021
UST briefly loses its peg; Do Kwon allegedly arranges secret HFT firm purchases to artificially restore the peg rather than letting the algorithm work, then publicly misrepresents the recovery as algorithmic.
July 2021
Terraform Labs injects $70 million into Anchor's yield reserve to prevent depletion.
20 January 2022
Luna Foundation Guard established; begins accumulating Bitcoin reserves as a UST peg backstop.
18 February 2022
Terraform Labs injects $470 million into Anchor's yield reserve — a second emergency bailout indicating structural insolvency of the yield model.
April 2022
LUNA reaches an all-time high of approximately $119.51. UST market cap approximately $18 billion. Anchor TVL peaks at $17.15 billion.
5 May 2022
LUNA trading at approximately $87; UST at $1.
7 May 2022
Two large wallet addresses withdraw approximately 375 million UST from Anchor; large UST sales on Curve begin pushing UST below $1.
9 May 2022
UST loses dollar peg for second time in 48 hours. LFG announces $1.5 billion BTC/UST deployment to defend peg. Do Kwon tweets 'Deploying more capital — steady lads.'
10 May 2022
LFG deploys final Bitcoin reserves — approximately 33,206 BTC exchanged for ~1.16 billion UST. Peg defense fails.
13 May 2022
LUNA supply exceeds 6.5 trillion tokens. LUNA price falls below $0.00005. UST trades at approximately $0.10-$0.20. Terra blockchain halted. Combined market cap loss approximately $40-45 billion.
16 May 2022
LFG discloses remaining reserves of 313 BTC from original 80,394 BTC.
25 May 2022
Terra community approves Terra Ecosystem Revival Plan 2 (Terra 2.0 fork) with 65% validator approval.
28 May 2022
Terra 2.0 blockchain launches with new LUNA token airdrop. Original chain rebranded Terra Classic (LUNC).
27 June 2022
Three Arrows Capital defaults on loan payments to Celsius and Voyager, triggering cascading bankruptcies.
July 2022
Celsius Network and Voyager Digital both file for Chapter 11 bankruptcy.
14 September 2022
South Korean prosecutors issue arrest warrant for Do Kwon.
12 December 2022
CoinDesk reports Do Kwon is believed to be in Serbia.
16 February 2023
SEC files fraud charges against Terraform Labs and Do Kwon in the Southern District of New York.
23 March 2023
Do Kwon and CFO Han Chang-joon arrested at Podgorica Airport, Montenegro, in possession of fake Costa Rican passports.
26 April 2023
South Korean prosecutors indict Daniel Shin on fraud-related charges.
21 January 2024
Terraform Labs files for Chapter 11 bankruptcy in Delaware.
5 April 2024
New York jury unanimously finds Terraform Labs and Do Kwon liable for securities fraud across all counts after less than two hours of deliberation.
12 June 2024
Terraform Labs and Do Kwon agree to $4.47 billion SEC settlement — largest SEC crypto enforcement settlement at the time.
19 September 2024
US bankruptcy court approves Terraform Labs wind-down plan.
27 December 2024
Montenegro Justice Minister approves Do Kwon's extradition to the United States.
12 August 2025
Do Kwon pleads guilty to two federal fraud charges; agrees to forfeit $19 million.
11 December 2025
Judge Paul A. Engelmayer sentences Do Kwon to 15 years in federal prison, calling the scheme 'a fraud on an epic, generational scale.'
Decision Log
- slot 461962988 · hash 17TawHFPMTzT3t6eSNh6umV9zEHkYheg7a8D27gZqip
- slot 457411807 · hash D119Fvz6YVPPGnKUTc4hctf9iDpy1eSjgz72V6ryC8Bo
- slot 423161824 · hash FFua9tniBiP1CLAKBCKQKdcaXEER1mhXZ2W1ckuXdDXS
- slot 419577228 · hash G2UZ8MSTW97JCQfk1LZUEbdREZcKuDmMCDK8ojLZ9c5h
- slot 419577223 · hash CLXsYzSL8DmBZxgdhytUjfdg29mDWuwoPcokncz2VB9p
This investigation is cryptographically anchored to the Solana blockchain (5 decisions).
model: claude-code-investigator
generated: 5/7/2026, 8:45:16 AM
last updated: 10/27/2026, 6:03:29 AM
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