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LUNA Jumps 53.57% Within a Day as Legal Proceedings Surrounding Do Kwon Unfold

LUNA Jumps 53.57% Within a Day as Legal Proceedings Surrounding Do Kwon Unfold

Bitget-RWA2025/12/06 16:44
By:Bitget-RWA

- LUNA surged 53.57% in 24 hours amid legal updates on Terraform Labs founder Do Kwon's 12-year prison sentence recommendation. - U.S. prosecutors cited Terra's $40B collapse as one of crypto's most destructive frauds, linking LUNA's volatility to systemic stablecoin risks. - Market speculation intensified as Kwon's December 11 sentencing hearing could reshape regulatory scrutiny of algorithmic stablecoins. - Despite 128% 7-day gains, LUNA remains far below its $80 peak, with future performance tied to leg

LUNA Sees Dramatic Price Jump Amidst Legal Turmoil

In the past 24 hours, LUNA’s value has skyrocketed by 53.57%, hitting $0.1354 as of December 6, 2025. Over the last week, the token has surged by 128.13%, and it has gained 114.54% in the past month. This recent upswing comes after a steep 62.65% drop over the previous year. The rally is widely linked to ongoing legal proceedings involving Terraform Labs co-founder Do Kwon.

Prosecutors Seek 12-Year Prison Term for Do Kwon

Do Kwon Legal Proceedings

U.S. federal prosecutors have called for Do Kwon to serve 12 years in prison due to his role in the 2022 collapse of the Terra ecosystem, which resulted in investor losses exceeding $40 billion. The sentencing recommendation, submitted to the Southern District of New York, highlights the scale of the alleged fraud and the widespread financial harm caused by the failure of TerraUSD (UST) and its companion token, LUNA.

The unraveling of Terra’s stablecoin system in May 2022 led to UST losing its dollar peg and triggered a rapid decline in LUNA’s value. Prosecutors allege that Kwon and Terraform Labs misrepresented the stability of UST, despite knowing about its weaknesses. The case has been described as one of the most damaging events in crypto history, with losses surpassing those from other major digital asset failures combined.

Legal Fallout and Market Reactions

The push for a 12-year sentence marks a pivotal moment in the aftermath of the Terra debacle, signaling the U.S. government’s intent to hold crypto leaders responsible for endangering investors and markets. The sentencing is set for December 11, 2025. Meanwhile, Kwon’s defense has argued for a reduced sentence of five years or less, referencing his previous detention and possible prosecution in South Korea.

News of the legal proceedings has coincided with LUNA’s sharp price increase. While some see this as renewed interest in the token, others interpret it as speculative trading driven by the unfolding legal drama. Market analysts note that investor sentiment may shift further depending on the sentencing outcome and whether Kwon faces extradition to South Korea for additional charges.

Market Landscape and Prospects for LUNA

Despite recent gains, LUNA’s price remains a fraction of its all-time high of $80, reached before the 2022 collapse. The token’s future is closely linked to overall crypto market trends and evolving regulations around stablecoins. Following the Terra crisis, industry experts have called for tighter oversight of algorithmic stablecoins, including enhanced reserve requirements and greater transparency.

The verdict in Do Kwon’s case is expected to shape future regulatory strategies for digital assets. A lengthy prison sentence would underscore the importance of accountability in the crypto sector and could discourage similar misconduct. At the same time, the situation highlights ongoing debates about balancing innovation with investor protection in the fast-changing world of digital finance.

As the sentencing date nears, investors and market watchers are paying close attention to developments that could influence LUNA’s direction. The token’s trajectory will hinge not only on the legal outcome but also on broader regulatory and economic factors affecting the global cryptocurrency landscape.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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