LUNA Drops 0.05% Amid Terra Founder’s 15-Year Sentence and Pending Class Action Lawsuit

On DEC 13 2025, LUNA dropped by 0.05% within 24 hours to reach $0.1835. Despite this recent decline, the token has seen a 41.27% increase over the past 7 days and a 152.22% surge in the last month. However, over the past year, LUNA has lost 56.09% of its value, reflecting ongoing market volatility tied to its controversial history.

Legal Developments Weigh on Investor Sentiment

A pending class-action lawsuit against MoonLake Immunotherapeutics (NASDAQ: MLTX) is drawing attention from investors, as the December 15, 2025, deadline to become a lead plaintiff approaches. The lawsuit alleges that the company and its executives made misleading statements about its drug SLK, including claims about its Nanobody structure offering superior clinical benefits over traditional monoclonal antibodies.

The firm’s recent Phase 3 VELA trial results were reported as disappointing, with VELA-2 failing to meet its primary endpoint. These developments have raised questions about the company’s transparency and the viability of its pipeline.

The legal action is being pursued under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The lawsuit claims that MoonLake’s promotional statements lacked a reasonable basis and failed to disclose material risks, misleading investors. As a result, several law firms, including Faruqi & Faruqi and Bleichmar Fonti & Auld LLP, are encouraging investors who purchased MLTX shares between March 10, 2024, and September 29, 2025, to contact them for legal guidance.

Sentencing of Terra Founder Adds to Market Uncertainty

Do Kwon, founder of Terraform Labs, was sentenced to 15 years in federal prison for his role in the 2022 Terra Luna collapse. U.S. District Judge Paul Engelmayer cited 315 victim impact letters that detailed severe personal and financial consequences, including bankruptcies, health crises, and suicides. The judge emphasized that while crypto investments carry risk, the fraud committed by Kwon was deliberate and caused widespread harm.

The sentencing hearing underscored the human toll of the collapse, which wiped out approximately $40 billion in value. Judge Engelmayer personally reviewed all 315 letters and adjusted his schedule to do so. Some victims called for the maximum sentence, while others, like Anita Youabian, suggested alternative restitution strategies. The judge balanced these perspectives in delivering a 15-year sentence, reflecting the seriousness of the fraud without dismissing Kwon’s lack of prior convictions.

Implications for the Crypto Ecosystem

The Terra collapse and related legal proceedings have had lasting effects on the broader cryptocurrency market. The failure of the UST stablecoin and Luna token exposed structural flaws in algorithmic stablecoin models and highlighted the need for stronger regulatory oversight. The Department of Justice and the SEC have since intensified scrutiny of crypto projects, particularly those making unsustainably high yield promises.

The UST de-pegging event in May 2022 triggered a broader market downturn and eroded trust in decentralized finance (DeFi) protocols. Post-collapse analyses indicate that over 16,500 investors sought restitution through legal proceedings. The Do Kwon sentencing case is now a landmark moment in crypto accountability, signaling a shift toward greater legal responsibility for project founders and executives.

While LUNA’s short-term price movement reflects market sensitivity to legal and regulatory news, the long-term trajectory will depend on broader industry developments and investor sentiment. The Terra case has served as a cautionary tale for the crypto space, reinforcing the importance of transparency, due diligence, and regulatory compliance.