The post Terraform Labs settles SEC charges for $4.47B appeared on BitcoinEthereumNews.com.

One of the biggest collapses in the history of cryptocurrency is finally ending, and Terraform Labs is willing to pay the SEC $4.47 billion. The SEC requested a federal judge in the Southern District of New York to accept the settlement. The new development comes two months after a judicial decision that found Terraform Labs guilty of acting recklessly. Terraform will pay the SEC $3.5 billion-plus interest, apart from a $420 million penalty. The co-founder of Terraform will pay $204.3 million in disgorgement, interest, and penalty. LUNA, Terra blockchain’s token, is on a slight upward movement, and the network is known for shedding almost 50% of its value. The high numbers depict only a small portion of the fund wiped out by Terraform during its collapse in May 2022. Terraforms Labs introduced LUNA, its native token, and UST, an algorithmic stablecoin backed by LUNA. The multibillion-dollar settlement between Terraform Labs and the SEC has raised eyebrows, and many people are suspicious about whether Terraform Labs has the potential to pay off the debt. The new agreement comes from the $40 billion market loss in 2022 that happened due to the collapse of the Terra ecosystem. The recent court filing discloses an agreement between the American regulator and Terraform Labs. This amount mixes disgorgement, prejudgment interest, and civil penalty. Terraform Labs had earlier declared bankruptcy ahead of its trial against the Securities and Exchanges Commission. The American Securities and Exchanges Commission stated that the penalties are fully justified and within the confines of the legal system. It is expected that the penalties will serve as a strong warning to other companies involved in deceptive activities. The Securities and Exchange Commission pointed out that the severity of these penalties is appropriate. The SEC took this decision after considering the trial evidence of…

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Filed under: News - @ June 13, 2024 6:24 pm