LUNA -21.84% in 24 Hours Amid Legal Proceedings Against Do Kwon

On DEC 7 2025, LUNA dropped by 21.84% within 24 hours to reach $0.1076, LUNA rose by 46.98% within 7 days, rose by 44.74% within 1 month, and dropped by 74.8% within 1 year.

Market Reaction to Legal Action in U.S. Case

The price of LUNA surged by more than 39% within a 24-hour window on December 6 as U.S. prosecutors announced their request for a 12-year prison sentence for Do Kwon, co-founder of Terraform Labs. Kwon is currently on trial in Manhattan for his role in the $40 billion collapse of the Terra ecosystem in 2022, a fallout that saw the Terra USD stablecoin lose its dollar peg and triggered steep declines in LUNA and other associated tokens.

The prosecution described Kwon’s actions as “colossal in scope” and argued that the severity of the fraud justified a harsh sentence. However, rather than deterring market sentiment, the development appeared to increase speculative interest in the Terra-related token.

Terra Luna Classic also saw a notable rise, climbing from approximately $0.000028 on December 4 to nearly $0.00008 by December 6, before retracing to around $0.00006 at the time of reporting. Similarly, LUNA’s price shot up from over $0.07 to nearly $0.15 in the same time frame, reflecting heightened trading activity.

Market Volatility Driven by Legal Uncertainty

Kwon, who rebranded LUNA as its successor in 2022, has pleaded guilty to the charges brought by the U.S. Department of Justice. His defense team has requested a five-year sentence, while the prosecution maintains its position of seeking up to 12 years in prison. A sentencing hearing is scheduled for December 11. Prosecutors have agreed to a deal allowing Kwon to serve half of his potential sentence in South Korea.

Analysts suggest that the legal proceedings may have inadvertently triggered a short-term rally among investors seeking to speculate on the future of the Terra ecosystem. Some traders appear to be treating the situation as an opportunity to position themselves ahead of potential regulatory or market developments.

Legal and Market Dynamics

The collapse of the Terra ecosystem in 2022 led to widespread fallout across the crypto market, with ripple effects on competing platforms and investors. Kwon’s arrest and subsequent legal battles have dominated headlines in the crypto space, with his case seen as a potential precedent for future legal actions against high-profile crypto founders.

In addition to the legal developments, market activity for other “bankruptcy-related” crypto assets also experienced significant gains. For example, USTC surged over 78% in 24 hours, while LUNC and FTT posted gains of more than 19% and 18%, respectively. These movements suggest broader speculative interest in tokens linked to failed or restructured crypto projects.

Sentiment and Outlook

Despite a 21.84% drop in the last 24 hours on December 7, LUNA has shown resilience over the past month, with a 44.74% increase since November 2025. However, its long-term performance remains subdued, having declined by 74.8% over the past year.

Analysts project that further legal updates, including the December 11 sentencing hearing, could continue to influence short-term trading patterns. However, no formal projections have been made regarding long-term price trajectories or broader market implications.

Summary

The Terra-related market saw increased volatility following the sentencing request in the U.S. case against Do Kwon. While LUNA experienced a sharp one-day decline on December 7, the broader trend over the past month reflects a period of speculative buying. The outcome of the legal proceedings will likely remain a focal point for investors and analysts monitoring the token’s performance in the coming weeks.