US Securities and Exchange Commission (SEC) in 2022 Terra (LUNA) He asked the New York court to impose a hefty $5.3 billion fine on Terraform Labs and its co-founder Do Kwon, on the grounds that they were involved in the $40 billion collapse of the ecosystem.
Terraform Labs and Kwon were convicted on fraud charges earlier this month. A jury in Manhattan found that the company and Kwon deceived investors about the stability of their so-called “algorithmic” native stablecoin, Terra USD (UST), and the use cases of the Terra blockchain.
The SEC, which filed for final judgment two weeks after the conclusion of the hearing, demands that Terraform Labs and Kwon pay damages and precautionary interest in the amount of $ 4.74 billion. Additionally, the regulator is seeking damages totaling $520 million, including $420 million from Terraform Labs and $100 million directly from Kwon.
The SEC justified the total amount in an attached memorandum filed with the court, stating that Kwon and Terraform Labs “received over $4 billion in illicit profits (and likely much more) from their illegal conduct.”
According to court documents, LUNA and MIR sales to institutional investors amounted to $65.2 million and $4.3 million, respectively. LUNA and UST sales through Luna Foundation Guard (LFG) totaled $1.8 billion. Additionally, investors can choose between June 2021 and May 2022. cryptocurrency It purchased $2.3 billion worth of UST on trading platforms.
The SEC added that the penalty amount represents a “conservative” but “reasonable approximation” of Terraform and Kwon’s “ill-gotten gains.”
In addition to hefty fines, the SEC is also seeking injunctive relief to prevent Kwon and Terraform Labs from committing further securities violations and buying or selling “any cryptoasset securities.” The regulator is also seeking an officer and director ban that would prohibit Kwon from serving as an officer or director of a public company reported by the SEC.
The SEC stated that such measures were necessary to deter future violations because “Defendants have shown no remorse for their conduct and cannot be doubted that they are in a position where additional violations are not only possible but have likely already occurred.”
*This is not investment advice.
For exclusive news, analysis and on-chain data Telegram our group, twitter our account and YouTube Follow our channel now! Moreover Android And iOS Start live price monitoring now by downloading our applications!