Meet Do Kwon, The ‘Crazy’ Man Who Created The Luna, The Terra Crypto That Collapsed in Days
- Do Kwon, the founder of the collapsed TerraUST and Luna has been known to be eccentric and saw it crash
- His rise to fame came when he wanted to create the algorithmic stablecoin that was meant to beg pegged to the dollar
- TerraUST collapsed recently dragging along its sister crypto whose value dropped to zero recently making investors lose millions
Do Kwon, the bizarre 30-year-old inventor of UST and Luna cryptos, established his status as one of the most known figures in the cryptocurrency industry, for all the wrong reasons.
His stablecoin, TerraUSD or UST which was meant to always be worth $1, tumbled to as low as 13 cents last week and dropped to as low as nine cents this, according to Fortune Magazine.
Source: Getty Images
Because of this, Kwon’s cryptocurrency, the Luna, also crumbled which resulted in massive losses for investors.
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Who is Do Kwon and how did come to have oversight of such a massive project that rose quickly and collapsed even faster?
His early life
He was born in South Korea in 1991 and attended Stanford University in 2010 where he graduated with a computer science degree in 2015, his LinkedIn page says. A public website he created says he worked at a Microsoft business partner and at Apple.
Do Kwon, under the pseudonym, Rick Sanchez helped to create the failed stablecoin called Basis Cash in 2020, according to CoinDesk. The failed algorithmic coin is similar to his other project, the UST.
The crash of Basis Cash, his first invention
Basis Cash, like the UST, was created to keep a tie to the US dollar through code rather than holding reserves in cash like other less perilous assets as a backup. It never reached its dollar value and it was abandoned by its developers.
He founded Terraform Labs in 2018 with a partner Daniel Shin who left the company later.
Terraform began to see interest almost immediately from investors. It raised $150 million in funding from investors like Arrington Capital, Pantera Capital and Galaxy Digital.
In August 2018, Terraform Labs also raised $32 million to create a modern system on the blockchain, VentureBeat said.
Within four years, investors like Arrington Capital and Coinbase Ventures have invested more than $200 million into the projects that were built using Luna’s underlying technology.
Most of these investors lost huge amounts after UST and Luna failed. Binance CEO, Changpend Zhao said that his company which invested $3 million investment in Luna increased to about $1.6 billion at the peak of Luna’s price in April but was worth less than $3,000 after it crased. Panterra Capital said it earned $170 million from an original $1.7 million investment after seeing about 80 per cent of its Luna holdings over the past year.
Beginning of fame
After Kwon successfully raised money for his startup, he made Forbes 30-under-30 list, partly because the magazine reported at the time he attracted about 40 million users to work with the company at the launch in January 2018. After it traded for $1 for many years, in January 2021, Luna, the counterpart crypto that was created to help UST stablecoin keep its dollar peg, began to rise in value. By the end of December 2021, Luna had risen to $99 and in April went to as high as $119.
Kwon announced that he wanted to buy $10 billion Bitcoin to back UST following concerns about how his stablecoin would keep the dollar peg.
Crypto billionaires who lost vast fortunes due to a tumble in prices
Legit.ng has reported that the crypto world has taken a hit in recent weeks as investors saw their fortunes plummet to abysmal levels, the worst since 2018, according to experts.
The founder of Coinbase Inc., Brian Armstrong was worth about $13.7 billion as recently as November 2021 and by the end of March 2022, he had $8 billion. But now, he has $2.2 billion to his name, Bloomberg Billionaire’s Index said, after a selloff was triggered in the digital currency industry.
From Bitcoin to Ether, there was a sharp decline in the market value of the firm, Coinbase, the biggest crypto exchange in the US.
Source: Legit.ng
