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Author: Jesse COGHLAN, Cointelegraph; Compilation: Tao Zhu, Bitchain Vision Realm
The US court judges have approved the $ 4.5 billion reconciliation agreement between TerraForm Labs, its co -founder DO Kwon and the US Securities and Exchange Commission.
Jed Rakoff, the judge of the New York District Court, approved the agreement on June 13.According to the agreement,Terra and Kwon will pay billions of dollars of fines and fines to regulatory agencies, and basically prohibit them from entering the encryption industry.
According to the agreement,TerraForm will pay nearly $ 3.6 billion illegal income, US $ 420 million in civil fines and about $ 467 million in interest.
Kwon agreed to pay $ 110 million in illegal income and $ 14.3 million in interest, as well as US $ 80 million in civil fines with Terraform.
In May 2022, Terraform’s encrypted ecosystem collapsed because its algorithm stabilized coin Terrausd (USS) (now Terraclassicusd (USSC)) lost linked to the US dollar.
The decourse triggers the death chain reaction of the Terra Classic (LUNC) tokens of the network, which aims to help the price of a stable coin.
SEC prosecuted Terraform and Kwon in February 2023, accusing them of violating securities law and fraud.
“This case confirms what the court has repeatedly said: The economic reality of the product -not label, publicity or hype -determining whether it belongs to the securities law,“SEC President Gary Gensler stated in a statement on June 13.
“The fraud activities of Terraform and Do Kwon have caused devastating losses to investors, and in some cases, they even wiped out their life savings,” he added.”Their fraud reminds us that when the company does not comply with the law, investors will be harmed.”
In 2022, the stable coin was decoupled in a few days and wiped off the value of $ 45 billion on the Terra blockchain.This incident triggered greater panic in the cryptocurrency market and led to a sharp decline in the value of many token.
Terraform Labs applied for bankruptcy in January, and it is unclear how it will get funds to pay huge amounts of reconciliation, because it discloses $ 430.1 million in assets and liabilities worth $ 450.9 million.
At the same time, Kwon is currently detained in Heishan. Previously, he had been prison for four months because he tried to leave the country in March last March.
He has been released until the country’s courts decided on the extradition request of the mutual competition between the United States and his motherland in South Korea, and he faced criminal charges between the two countries in South Korea.
Kwon’s legal team successfully appealed to his extradition last month, and the Heishan High Court will decide where to extradite him.
