SEC Litigation Against Terraform and Kwon Do-kwon’s Settlement Approach
Terraform Labs and former CEO Do Kwon are on the verge of solving the following problems: Fraud case by the U.S. Securities and Exchange Commission (SEC); As recent court documents reveal.
Terraform Labs and Attorney Kwon expressed their opinions in a phone call on May 29. A preliminary agreement has been reached to resolve the fraud allegations.
Final settlement terms are expected to be prepared and submitted. Court approval by June 12, 2024.
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The committee It requested approximately $5.3 billion. The defendant may be awarded damages, prejudgment benefits, and civil penalties. Terraform Labs proposed a $1 million fine. We oppose distortions by groups like the Luna Foundation Guard that were not explicitly mentioned in the SEC case.
The SEC also proposed. Mr. Kwon Do-kwon is prohibited from serving as an officer or director of a securities issuing company. Additionally, the SEC required: Mr. Kwon’s financial accounts and assets will be fully disclosed. However, Kwon asserted his Fifth Amendment rights and argued: Such disclosure may lead to self-incrimination.
These legal issues include: Fall of Terraform Labs in May 2022; This marked the beginning of the “crypto winter” and resulted in financial losses for numerous cryptocurrency companies and investors.
The SEC filed charges against Terraform Labs and Do Kwon. Deceptively promoting and selling cryptocurrency; Specifically TerraUSD (UST) and other Terra-related tokens. Regulators claimed Terraform and Kwon misled investors. They promote these tokens without proper registration and provide false assurances about their stability and potential returns.
A U.S. court found Terraform Labs and Kwon. Responsibility for deceiving investors April 2024.
Mr. Kwon was arrested in Montenegro in March 2023 on charges of trying to leave the country with forged documents. He was released on bail, but Kwon He faces possible legal action in Montenegro and is the subject of an extradition request from the United States.
The next few weeks will be critical as the court will likely review and approve the terms of the settlement.
With a master’s degree in Economics, Politics, and Culture in East Asia, Aaron wrote a scientific thesis analyzing the differences between Western capitalism and collective capitalism after World War II.
With nearly 10 years of experience in the fintech industry, Aaron understands all of the biggest issues and challenges cryptocurrency enthusiasts face. He is a passionate analyst who delivers data-driven and fact-based content as well as speaking to both Web3 natives and industry newcomers.
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