The Terraform Labs bankruptcy case has set a deadline for victims of the Terra collapse to file their crypto loss claims.
Claims must be submitted by August 21, 2024, at 6:00 PM ET or 10:00 PM UTC. This deadline is a crucial step toward providing relief for those affected by the collapse of the Terra ecosystem.
Deadline for Terra Collapse Claims
Victims of the Terra collapse must file their crypto loss claims by August 21, 2024, at 6:00 PM ET or 10:00 PM UTC to participate in Terraform Labs’ Chapter 11 bankruptcy proceedings. The Terra ecosystem experienced a dramatic collapse in May 2022, triggered by the depegging of the TerraUSD stablecoin. This led to a massive $40 billion loss for investors, with TerraUSD and Terra tokens losing nearly 99% of their value. The crisis affected the broader crypto market, causing Bitcoin (BTC) to drop to $17,593 a month later.
Terraform Labs, the firm behind Terra, filed for Chapter 11 bankruptcy in January 2024 to address the fallout and restructure amid financial difficulties. The court has mandated that claims must be submitted by the deadline to participate in voting on the proposed Chapter 11 plan. Eligible claimants are those who suffered losses from Terraform Labs Pte Ltd before January 21, 2024, and from Terraform Labs Limited before July 1, 2024.
Missing the deadline will not prevent future claims but will affect voting rights on the bankruptcy plan. The deadline is for voting purposes only, not for fund distribution, which will be addressed later. Claims can be submitted online or by mail, with Epiq Corporate Restructuring, LLC overseeing the process. Detailed instructions and forms are available on the Epiq Corporate Restructuring website.
August Deadline for Terra Collapse Claims and Recent Developments
The upcoming August deadline is a pivotal moment for victims of the Terra collapse, offering them the opportunity to have their losses officially recognized in the bankruptcy proceedings. Legal and financial experts urge all eligible claimants to file promptly.
This announcement follows Terraform Labs’ recent settlement with the U.S. Securities and Exchange Commission (SEC) in June 2024, where the company agreed to a $4.47 billion payment. Additionally, recent reports confirm that the court has mandated Terraform Labs to undelegate and burn 150 million LUNA tokens and to reopen the Terra Classic shuttle bridge.
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