Terra (LUNA) Nearly two years after its $40 billion collapse, the once-favorite cryptocurrency The first hearing in a series of lawsuits filed against the company is entering its final chapter.
The fraud case filed by the U.S. Securities and Exchange Commission (SEC) against Terraform Labs and its founder Do Kwon is wrapping up in a Manhattan federal courtroom with just days to go before it ends, as the defense began presenting its case on Tuesday.
Defense attorneys representing Terra and Kwon said they planned to call only a few witnesses before closing arguments began Thursday afternoon. They will have an uphill battle to overcome the significant evidence the SEC has presented to the jury over the past few weeks.
The civil suit seeks to resolve two key issues related to Terra’s marketing allegations before its May 2022 collapse. The SEC alleges that Terra told investors that a large Korean company was using blockchain technology, but actually did not. The SEC also alleges that Terra misled investors that its algorithmic stablecoin UST could maintain its peg of $1.
While not a criminal case with potential prison time, the jury’s interpretation of the evidence presented could impact future prosecutions against Kwon in South Korea and the United States.
The SEC has made some significant gains so far, including Judge Rakoff allowing screenshots showing Kwon discussing creating “fake transactions that appear to be real,” drawing shocked reactions from many jurors when read aloud.
Former Terra whistleblowers and former executives of payments company Chai have provided compelling testimony through records and documents about misleading claims regarding Chai’s use of the Terra blockchain.
On the subject of stablecoins, expert analysis showed that Terra’s token UST would have completely collapsed in 2021 had it not been for crypto trading firm Jump’s intervention of over $200 million to defend UST’s $1 peg.
As Terra’s defense begins Tuesday by summoning CEO Chris Amani, its legal team faces an uphill battle to rehash key evidence against the company’s past practices and marketing claims.
*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!