Do Kwon, founder of Terraform Labs, pleaded guilty Tuesday to fraud charges over the $40 billion collapse of his firm’s cryptocurrency ecosystem.

Qubic, a blockchain project led by former IOTA co-founder Sergey Ivancheglo, claims it now controls more than half of Monero’s global hashrate, raising alarms over the possibility of a 51% attack on the privacy-focused network.

Stablecoin issuer Circle (CRCL) said Tuesday it will sell 10 million shares in a secondary offering, sending its stock down in after-hours trading.

Top stories in the Crypto Roundup today:

• Terraform Labs Founder Do Kwon Pleads Guilty in $40B Crypto Fraud Case
• Qubic’s Claim of Monero Majority Hashrate Sparks 51% Attack Concerns
• Circle Shares Fall After 10M-Share Secondary Offering Announcement

Terraform Labs Founder Do Kwon Pleads Guilty in $40B Crypto Fraud Case

Do Kwon, founder of Terraform Labs, pleaded guilty Tuesday to fraud charges over the $40 billion collapse of his firm’s cryptocurrency ecosystem.

The 33-year-old admitted in Manhattan federal court to conspiring to commit commodities, securities and wire fraud, as well as a separate wire fraud charge. A plea deal caps his potential prison term at 12 years, with sentencing set for Dec. 11.

Terraform’s TerraUSD stablecoin was designed to hold a $1 peg through algorithms and its sister token Luna. In May 2022, the peg broke, wiping out billions for investors worldwide.

Kwon was extradited from Montenegro last year after being arrested with a false passport. He will forfeit $19 million and surrender his interest in Terraform Labs and its tokens. U.S. prosecutors called the case one of the largest frauds in history.

Qubic’s Claim of Monero Majority Hashrate Sparks 51% Attack Concerns

Qubic, a blockchain project led by former IOTA co-founder Sergey Ivancheglo, claims it now controls more than half of Monero’s global hashrate, raising alarms over the possibility of a 51% attack on the privacy-focused network.

If accurate, the milestone would give Qubic the power to reorganize blockchain history, censor transactions and attempt double-spends. 

Ivancheglo described the effort as a “stress test” meant to prepare Monero for future threats, but developers and security experts remain divided on whether the move is benign or a takeover.

A 51% attack occurs when one entity controls the majority of a proof-of-work network’s mining power. Past incidents on Ethereum Classic, Bitcoin Gold and Verge have led to millions in losses and eroded trust in the affected networks.

Monero’s RandomX algorithm is designed to resist ASIC dominance, but Qubic’s “useful proof-of-work” model redirects mining rewards into USDT purchases used to buy and burn its own QUBIC tokens. Qubic’s share of Monero’s hashrate surged from under 2% in May to over 25% by late July, occasionally topping mining pool charts.

Ledger CTO Charles Guillemet warned on X that Monero “appears to be in the midst of a successful 51% attack,” while other analysts, including SlowMist founder Yu Xian, questioned whether Qubic’s economic model is sustainable.

Circle Shares Fall After 10M-Share Secondary Offering Announcement

Stablecoin issuer Circle (CRCL) said Tuesday it will sell 10 million shares in a secondary offering, sending its stock down in after-hours trading.

According to an SEC filing, the company will sell 2 million shares of Class A common stock, while existing stockholders will offer another 8 million. Underwriters have the option to purchase an additional 1.5 million shares.

The sale comes just two months after Circle’s New York Stock Exchange debut, which saw its shares surge from an IPO price of $31 to a record $299. At $154 after Tuesday’s drop, the stock is still trading at nearly five times its listing price but has lost about half its peak value.

Earlier in the day, Circle reported a $428 million second-quarter loss. The company issues the USDC stablecoin, one of the largest dollar-pegged digital assets by market capitalization, and went public amid heightened investor interest in the stablecoin sector.

State of the Crypto by Top Tier Exchange Volume

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