📣 Terraform Labs, Founder Do Kwon May Face a $5.3 Billion Fine

🔸 Celebrating 2 Years, Do Kwon Promises to Deploy More Capital

On May 9, Do Kwon assured the Terraform community that he is deploying more capital to solve the de-peg problem of the UST algorithmic stablecoin. On May 11, Kwon presented UST's strategy to reset stability. Kwon's tweet from 2022 has resurfaced on X.

In the two years since Kwon's tweet, the US Securities and Exchange Commission (SEC) asked a New York court to fine Terraform Labs and its founder Do Kwon $5.3 billion. The regulator has demanded a hefty penalty for the entities' role in the $40 billion Terraform ecosystem token explosion.

The SEC has sought the return of $4.74 billion as required by law for ill-gotten gains, and another $420 million from Terraform Labs and $100 million from founder Kwon. The US financial regulator has argued that the fines are a “conservative” but reasonable approximation of the amount of money Terraform Labs and Do Kwon made from the fraud.

The court ruled that the two parties were liable for civil fraud, and court documents revealed $65.2 million worth of LUNA sales to institutional investors. Luna Foundation Guard sold 1.8 billion USD of LUNA and UST.

The collapse of the Terraform ecosystem, Kwon's "illegal profits" and court fines are the consequences of a $4 billion explosion in 2022 that destroyed the greenhouses of several exchange companies. cryptocurrency exchanges, lenders and led to a series of bankruptcies throughout 2022 and 2023.

🔸 Terra Foundation Restricts Access to TFL Products to Users in the United States

In light of recent court developments, Terra Foundation has made changes to its operations and announced that it will restrict access to some of its products and features to users in the United States. Ky. Open source projects to which TFL contributes, such as the Terra and Alliance blockchains, remain unaffected.