Key Highlights:
- SEC Stands Firm: The SEC rejects the jury’s leniency towards Terraform Labs and Do Kwon, demanding a swift judgment. βοΈπ«
- Counterarguments: Terraform Labs and Kwon ardently dispute SEC’s claims, asserting their tokens aren’t securities. π‘οΈπΌ
- Blame Game: Terraform accuses Citadel Securities of a deliberate depegging attempt, but the latter denies any involvement. πβ
In a recent twist in the world of cryptocurrency, the United States Securities and Exchange Commission (SEC) has taken a firm stance against Terraform Labs, a blockchain company. The SEC is adamantly challenging a jury’s findings related to alleged misconduct within the company and its ecosystem, spearheaded by none other than Do Kwon. ποΈπΌ
Do Kwon and SEC’s Relentless Pursuit π
SEC’s Stiff Resistance π In a legal document dated October 27, the SEC displayed its hesitation to concur with the jury’s sympathetic stance towards Do Kwon. The agency emphasized its belief that Kwon played a pivotal role in orchestrating deceptions leading to the downfall of Terra’s digital environment. The filing in the U.S. District Court for the Southern District of New York unequivocally stated, “No rational jury could conclude that Kwon was not liable for Terraformβs violations.”
Allegations Galore π The SEC’s “proof” of infractions underscores Kwon’s purported role in swaying crypto enthusiasts by promoting Terra and its native Terra (LUNA) tokens as securities. Simultaneously, Kwon and Terraform Labs sought to dismiss the SEC’s allegations, contending that their offerings, including Terra Classic (LUNC), Terra Classic USD (USTC), and Mirror Protocol (MIR), don’t qualify as securities.
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The Counterclaim: Terraform Labs Fights Back π₯
Refuting Claims β On the flip side, Terraform Labs and Kwon passionately rebuffed the SEC’s claims. They argued that their digital tokens and mirrored assets (mAssets) were not securities, as implied by the SEC. They challenged the accusations of participating in unregistered transactions and alleged fraudulent activities.
A Blame Game π Interestingly, Terra’s co-founder, Daniel Shin’s legal representative pointed fingers at the “irrational functioning of the Anchor Protocol and assaults initiated by Do-hyung Kwon” for the ecosystem’s implosion. The firm recently accused market maker Citadel Securities of orchestrating an intentional effort leading to the depegging of its TerraUSD (UST) stablecoin in 2022. Citadel Securities, however, dismissed these allegations as baseless.
Sergio Richi
Editor, Logll