Terraform Labs and its founder reached a preliminary agreement with the SEC.

It was reported that Terraform Labs and its co-founder Do Kwon, who were tried for fraud in the case held in the USA yesterday, agreed in principle with the US Securities and Exchange Commission (SEC).

According to Reuters, the details of the preliminary agreement with Kwon and Terraform Labs, who were found guilty of civil fraud, have not yet been disclosed. The SEC filed a lawsuit against #Terraform Labs, accusing it of deceiving investors through its dollar-pegged crypto asset TerraUSD. The crypto assets of the Terra ecosystem saw serious demand in a short time, with the attractive return rates they offered at that time, and became among the largest assets in the market. However, when it was understood that the service offered was not sustainable, Terra's algorithmic stable cryptocurrency could not recover despite all efforts after breaking the stability of 1 dollar and reset its value along with the other crypto asset of the ecosystem, LUNA.

The collapse of Terraform Labs in May 2022 caused a tremendous loss in the crypto market, reaching $40 billion. In addition, many crypto companies that had commercial relations with the platform had to declare bankruptcy.

After all these events, the #SEC filed a lawsuit against the crypto platform, demanding compensation of $ 5.3 billion based on its activities in the USA. However, the regulatory body also demanded an administrative fine of 420 million dollars from the company and 100 million dollars from its founder Do Kwon. Meanwhile, while Do Kwon's sentence in Montenegro continues, both the #USA and South Korea demand Kwon's extradition to their country.

With the announcement that the parties had reached a preliminary agreement, some market participants thought that the development would positively affect the assets of #LUNA and LUNC, while others questioned how the collapsed company could pay the penalty.
$BTC $LUNA