Terraform Labs, Do Kwon settle with SEC preliminary! LUNA jumped 40% on the news

This site (120btC.coM): After the sudden collapse of LUNA and UST in 2022, the U.S. Securities and Exchange Commission (SEC) launched an investigation into Terraform Labs and its founders in February last year. Do Kwon filed a civil lawsuit.

The SEC alleged in the lawsuit that Terraform’s collapse in 2022 cost investors $40 billion. After a long time, in April this year, a New York federal jury officially found Do Kwon and Terraform Labs guilty of fraud.

Terraform Labs, Do Kwon and SEC preliminary settlement

And just last night, according to the latest news from Cointelegraph, Terraform Labs and Do Kwon have agreed in principle to reach a settlement with the SEC in the fraud case. The settlement Terms will be finalized and submitted to the court for approval by June 12, 2024.

It is understood that the SEC’s case charges against Terraform and Do Kwon mainly focus on their misleading promotion and sales of the algorithmic stable currency TerraUSD (UST) and Terra-related tokens.

"The SEC charged Terraform and Kwon with offering crypto assets without proper registration and misleading investors about their stability and investment potential."

$5.3 billion sky-high fine

After winning the civil lawsuit, the SEC then submitted a motion to the Southern District Court of New York, requiring Do Kwon and Terraform Labs to pay a sky-high fine of approximately US$5.3 billion. According to the document, Kwon and Terraform made more than $4 billion in "illegal gains" through unregistered token sales such as LUNA and UST.

The proposed penalties include a disgorgement penalty of $4.2 billion and prejudgment interest of $545 million, as well as civil penalties against Terraform's Do Kwon of $420 million and $100 million, respectively.

Do Kwon still faces criminal charges and extradition is pending

However, it should be emphasized that in addition to the SEC’s civil lawsuit, Do Kwon is currently facing criminal charges in South Korea and the United States, but South Korea The man-stealing war between the United States and the United States remains unresolved.

He was originally ruled to be extradited to the United States for trial in February, but in March the appeals court changed the ruling to extradite to South Korea. Later, the Supreme Prosecutor's Office of Montenegro asked the Supreme Court to overturn the ruling and sought to have Do Kwon transferred to South Korea. He is still awaiting a decision in Montenegro for extradition to the United States.

LUNA once rose nearly 40%

Just after the news came out that Terraform Labs and Do Kwon agreed to settle with the SEC, LUNA once rose nearly 40%, breaking through $0.8 from $0.6. However, selling pressure soon emerged, and it had fallen back to $0.667 before the deadline, with the increase in the past 24 hours narrowing to 19.3%.

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