U.S. District Court for the Southern District of New York, Securities and Exchange Commission (SEC) terraformed He made an important decision in an ongoing lawsuit between Labs.
Judge Jed Rakoff SEC In ruling in its favor, it held that Terraform Labs offered and sold unregistered securities. However, the court also attracted attention by giving decisions in favor of Terra on some details, including allegations regarding the offer and execution of security-based swap transactions.
Judge Rakoff’s decision is based on the Howey Test, a cornerstone of securities law. This is considered a good example of how an important issue that is frequently discussed in the cryptocurrency world is handled legally.
The SEC’s lawsuit relied on Terraform’s claim that its digital assets were “investment contracts” and therefore securities under the law. The defense’s effort to jettison decades of established Supreme Court and Second Circuit law did not work.
of Terraform TOPDespite its argument that it is not a standalone security due to its pegged value of $1, the court cited promotional efforts and promises of high returns associated with the Anchor Protocol as influencing the decision.
Koinfinans.com As we reported, the decision’s inclusion of the “Howey Test” is the most striking detail of the case. However, it is important to note that the case also intimidates other entities in the crypto world.