Terraform Labs Agrees To Pay $4.47 Billion Fine With SEC

Terraform Labs has reached a settlement in its lawsuit with the Securities and Exchange Commission (SEC), with the defunct crypto firm agreeing to pay a $4.47 billion fine for its fraudulent activity related to the defunct Terra blockchain.

  • In a Wednesday letter to US District Judge Jed Rakoff, the SEC asked for approval of its “proposed final consent judgement” concerning Terraform and its famous co-founder, Do Kwon.
  • The agency claimed that the seismic penalty addresses the “magnitude of this fraud” while allowing for “meaningful and speedy recovery” of the billions of dollars lost by the network’s investors.
  • “To settle this action, Terraform agrees to provide the SEC with all the relief it sought from the Court,” the letter stated. That includes $3.6 billion in disgorgement, $466 million in prejudgment interest, and a $420 million civil penalty – nearly matching what the SEC had requested in April.
  • Kwon himself has agreed to pay nearly all penalties the SEC requested, including $204 million in monetary relief that will go entirely to the Terraform Labs bankruptcy estate to aid harmed investors.
  • The SEC charged Terraform and Kwon with securities fraud in 2023 related to the fallen Terra blockchain, whose unstable design resulted in a spectacular $44 billion blowup across its LUNA and UST tokens.
  • In early April, a jury found Terraform and Kwon guilty of misleading investors and of deliberate fraud.
  • “The entry of this judgment would ensure the maximal return of funds to harmed investors and put Terraform out of business for good,” the SEC concluded.

  • If accepted, this would mark the largest settlement in a crypto fraud case to date, outsizing even Binance’s $4.3 billion settlement with the Justice Department in November.
  • Still, some are skeptical that Terraform or Kwon actually have the money to pay the charges.
  • “$4.47B cash-out is impossible, even with a $40B market ca,” wrote CryptoQuant CEO Ki Young Ju on the matter. “Do and Terraform aren’t supposed to hold that much money.”

The post Terraform Labs Agrees To Pay $4.47 Billion Fine With SEC appeared first on CryptoPotato.

How useful was this post?

Click on a star to rate it!

Average rating 0 / 5. Vote count: 0

No votes so far! Be the first to rate this post.

Latest posts

post-thumbnail
Crypto Manipulation Exposed: ‘Zopp0’ and Influencers Accused of Promoting Shady Projects
The post Crypto Manipulation Exposed: ‘Zopp0’ and Influencers Accused of Promoting Shady Project...
READ MORE
post-thumbnail
Bitcoin ETFs See $2.22B Inflow, Third-Largest on Record
The post Bitcoin ETFs See $2.22B Inflow, Third-Largest on Record appeared first on Coinpedia Fintech...
READ MORE
post-thumbnail
Metawin Crypto Casino Loses $4M in Hot Wallet Hack, Funds Replenished
The post Metawin Crypto Casino Loses $4M in Hot Wallet Hack, Funds Replenished appeared first on Coi...
READ MORE
post-thumbnail
Crypto Market Braces for $349M Token Unlocking Event 
The post Crypto Market Braces for $349M Token Unlocking Event  appeared first on Coinpedia Fintech ...
READ MORE
post-thumbnail
Whale Bets $5M on Harris Ahead of U.S. Election
The post Whale Bets $5M on Harris Ahead of U.S. Election appeared first on Coinpedia Fintech News Wi...
READ MORE
post-thumbnail
Circle Eyes Hong Kong Expansion Amid Stablecoin Growth Plans
The post Circle Eyes Hong Kong Expansion Amid Stablecoin Growth Plans appeared first on Coinpedia Fi...
READ MORE
Read more posts