In a dramatic opening to a much-anticipated trial, the US SEC cast Terraform Labs and its co-founder, Do Kwon, as central figures in a vast financial deception that left investors nearly destitute following its collapse, Reuters reported on March 26.
The trial, unfolding in the US District Court for the Southern District of New York, marks a significant moment in closing the chapter on one of the biggest black swan events in the crypto industry.
The SEC accused Terraform Labs and Kwon of conducting a multi-billion dollar crypto asset securities fraud, leading to the lawsuit filed in February 2023.
House of cards
The SEC’s legal team, led by attorney Devon Staren, did not mince words, describing Terra as a “house of cards” that inevitably toppled, erasing vast amounts of investor capital.
Central to the SEC’s allegations is the claim that Terraform Labs and Kwon deliberately misled investors regarding the stability of Terra USD (USTC).
The algorithmic stablecoin dramatically fai
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