Terraform Labs has agreed to pay a penalty larger than the fine imposed on crypto exchange Binance by the U.S. Justice Department.
Court filings from Wednesday reveal that Terraform Labs has reached a $4.47 billion settlement with the U.S. Securities and Exchange Commission (SEC) over the collapse of TerraLuna (LUNC) and TerraUSD (UST).
This proposed penalty follows a two-week trial in March and a preliminary agreement announced late last month. A jury found both Terraform and its founder, Do Kwon, legally accountable for the company’s 2022 crash.
The settlement requires approval from a New York judge and could become one of the largest settlements between a cryptocurrency entity and a U.S. regulator. The SEC initially sought $5.3 billion in fines from both Terraform Labs and its founder.
Federal prosecutors initially pushed for $4.7 billion in disgorgement, along with a combined $520 million in civil penalties from the firm and Do Kwon.
Terraform’s founder extradition
Do Kwon is currently awaiting extradition in the Balkans, pending approval for his transfer to either the U.S. or his home country, South Korea.
Kwon’s sentence for travel document fraud ended in March, and he was subsequently released under home arrest from Spuž prison in Montenegro. The former crypto mogul was previously on the run after the $60 billion collapse of Terra caused widespread turmoil in the digital asset industry, leading to a series of bankruptcies among various entities.
Extradition to either the U.S. or South Korea has been approved multiple times, but these decisions have been overturned due to ongoing disputes between attorneys and Montenegro’s judicial system. As of now, Kwon’s extradition destination remains uncertain, and the former crypto-billionaire could face a lengthy prison sentence for his role in Terra’s collapse.
0 Comments