BTC

$64609.077

-1.18%

ETH

$3512.34

-1.86%

BNB

$587.147

-2.26%

XRP

$0.49

-0.88%

News

Terraform Labs SEC Lawsuit Settled For $4.47 Billion

June 12, 2024 - Around 2 mins mins to read

Key Points:

  • Terraform Labs and Do Kwon settle with SEC for $4.47 billion over TerraUSD collapse.
  • SEC alleges deception on TerraUSD stability and false claims on integration.
  • In Terraform Labs SEC lawsuit, Kwon faces criminal charges, disputes fines, and awaits extradition from Montenegro.
According to Reuters, Singapore-based Terraform Labs and its founder Do Kwon have reached a settlement with the U.S. Securities and Exchange Commission (SEC) follows a lawsuit and deception of cryptocurrency investors before the collapse of stablecoin TerraUSD in 2022.
Terraform Labs SEC Lawsuit Settled For $4.47 Billion

Terraform Labs SEC Lawsuit Reaches Settlement for $4.47 Billion Resolution

Terraform has agreed to settle a $4.47 billion to resolve the Terraform Labs SEC lawsuit, arising from the firm’s collapse in 2022, which results in the loss of $40 billion in investor assets, sending shockwaves through the cryptocurrency community.

Terraform Labs SEC lawsuit originates from the company itself and Do Kwon, they misled investors in 2021 regarding the stability of TerraUSD, a stablecoin intended to retain a value of $1. Additionally, the regulator accuses them of falsely claiming that Terraform’s blockchain was integrated into a popular South Korean mobile payment app.

The settlement, subject to approval by a federal judge in New York, comes subsequently to a jury holding the company and Kwon accountable for the collapse after a two-week trial.

Do Kwon Faces Charges Amidst Disputed Fines

The SEC‘s estimation suggests that investors lost over $40 billion collectively when TerraUSD failed to maintain its peg to the dollar. The regulatory body also proposed a $420 million penalty for the company and a $100 million penalty for Kwon, along with banning both from dealing in “crypto asset securities.”

However, Kwon, who faces related criminal charges in the U.S. and South Korea, has disputed these penalties, arguing that the maximum fines permissible were significantly lower. Since his arrest in March 2023, Kwon has been waiting for extradition from Montenegro, amidst ongoing turmoils regarding his destination. He maintains his innocence regarding the allegations.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

do kwon

LUNA

SEC

Terraform Labs

Terraform Labs SEC Lawsuit

TerraUSD

UST

Avatar of Harold

Author

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.
News

Terraform Labs SEC Lawsuit Settled For $4.47 Billion

Key Points:

  • Terraform Labs and Do Kwon settle with SEC for $4.47 billion over TerraUSD collapse.
  • SEC alleges deception on TerraUSD stability and false claims on integration.
  • In Terraform Labs SEC lawsuit, Kwon faces criminal charges, disputes fines, and awaits extradition from Montenegro.
According to Reuters, Singapore-based Terraform Labs and its founder Do Kwon have reached a settlement with the U.S. Securities and Exchange Commission (SEC) follows a lawsuit and deception of cryptocurrency investors before the collapse of stablecoin TerraUSD in 2022.
Terraform Labs SEC Lawsuit Settled For $4.47 Billion

Terraform Labs SEC Lawsuit Reaches Settlement for $4.47 Billion Resolution

Terraform has agreed to settle a $4.47 billion to resolve the Terraform Labs SEC lawsuit, arising from the firm’s collapse in 2022, which results in the loss of $40 billion in investor assets, sending shockwaves through the cryptocurrency community.

Terraform Labs SEC lawsuit originates from the company itself and Do Kwon, they misled investors in 2021 regarding the stability of TerraUSD, a stablecoin intended to retain a value of $1. Additionally, the regulator accuses them of falsely claiming that Terraform’s blockchain was integrated into a popular South Korean mobile payment app.

The settlement, subject to approval by a federal judge in New York, comes subsequently to a jury holding the company and Kwon accountable for the collapse after a two-week trial.

Do Kwon Faces Charges Amidst Disputed Fines

The SEC‘s estimation suggests that investors lost over $40 billion collectively when TerraUSD failed to maintain its peg to the dollar. The regulatory body also proposed a $420 million penalty for the company and a $100 million penalty for Kwon, along with banning both from dealing in “crypto asset securities.”

However, Kwon, who faces related criminal charges in the U.S. and South Korea, has disputed these penalties, arguing that the maximum fines permissible were significantly lower. Since his arrest in March 2023, Kwon has been waiting for extradition from Montenegro, amidst ongoing turmoils regarding his destination. He maintains his innocence regarding the allegations.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Visited 111 times, 1 visit(s) today