Terraform Labs ‘Built on a Lie’ – SEC on Trial
As the lawsuit between Terraform Labs and the United States Securities and Exchange Commission (SEC) draws to a close, lawyers say the crypto company made several false claims to investors about its platform.
According to an April 5 Reuters report, SEC attorneys in the US District Court for the Southern District of New York said Terraform's story was “built on lies,” including the algorithmic stablecoin TerraUSD (UST) and its merger with South Korea. Payment application. Terraform attorney Luis Pellegrino said co-founder Do Kwon has been truthful in public statements, and the SEC's case is based on information taken out of context.
The civil suit with the SEC comes more than a year after the commission filed charges against Terraform in February 2023. The regulator at the time accused the stage and Koon of calling it an “orchestra”.[ed] A multi-billion dollar crypto asset underwriting scam.
During the trial, SEC attorneys compared Terra to a “house of cards” that fell for investors in 2022.
RELATED: Montenegro's Supreme Court Sends Do Kwon's Extradition Case to Lower Court
The trial has been moving forward without Kwon appearing in person. The Terraform co-founder will remain in Montenegro while the courts decide to grant extradition requests from the US or South Korea. He was arrested in March 2023 for using forged travel documents.
In January, Judge Jed Rakoff ruled in SEC v. Terraform Labs moved the trial date to March 25 in an attempt to accommodate Kwon. Other major figures in the crypto space headed to court in the US include former Celsius CEO Alex Mashinsky for a January 2025 criminal trial and former Binance CEO Changpeng Zhao for an April 30 sentencing hearing.
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