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Terra (LUNA) crypto collapse marks 4 years, wiping out $40-$60B and leading to founder's arrest.

Market News
12 May 2026
Zycrypto
View Source
Bearish
pluang ai news

Four years ago, the Terra (LUNA) cryptocurrency collapsed after its stablecoin UST lost its $1 peg, triggering a hyperinflationary death spiral that devalued LUNA from $129 to nearly zero in hours. This crash wiped out $40-$60 billion of user funds and caused major crypto lenders like Three Arrows Capital and Celsius to go bankrupt, with total losses exceeding $100 billion. Founder Do Kwon fled but was caught and sentenced to 15 years in the US for his role in the collapse. The event highlights risks of unbacked stablecoins and complex DeFi systems under real market stress.

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