U.S. Judge Signs Off on $4.5B Terraform-Do Kwon Settlement With SEC
-
A U.S. judge has agreed to a settlement between the SEC, Do Kwon and Terraform Labs.
-
The settlement involves a $4.5 billion penalty and a ban on trading “crypto asset securities.”
A U.S. District Court judge has agreed to a settlement between the Securities and Exchange Commission (SEC), Terraform Labs and its former CEO, Do Kwon, which would have them pay billions in penalties as well as virtually ban them from the crypto industry, according to the court filings.
The settlement approved by Judge Jed Rakoff of the Southern District of New York (SDNY) involves Terraform Labs Kwon paying $4.5 billion in disgorgement and civil penalties while being permanently banned from buying and selling “crypto asset securities,” including Terra ecosystem tokens. It’s unclear if this also applies to other cryptocurrencies.
This settlement is below the SEC’s first offer of $5.3 billion but much higher than the $1 million civil penalty that Terraform first proposed.
Kwon, still in custody in Montenegro awaiting a decision on his extradition, did not appear at the trial where the settlement was reached.
Terraform Labs is currently in Chapter 11 bankruptcy protection, its CEO Chris Amani testified at the trial, and has approximately $150 million in assets on hand.
Edited by Jesse Hamilton.
Disclosure
Please note that our
privacy policy,
terms of use,
cookies,
and
do not sell my personal information
has been updated
.
CoinDesk is an
award-winning
media outlet that covers the cryptocurrency industry. Its journalists abide by a
strict set of editorial policies.
In November 2023
, CoinDesk was acquired
by the Bullish group, owner of
Bullish,
a regulated, digital assets exchange. The Bullish group is majority-owned by
Block.one; both companies have
interests
in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin.
CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.