Crypto News

SEC Requests Summary Judgment in Do Kwon and Terraform Labs Matter

The U.S. Securities and Exchange Commission (SEC) rebutted the jury’s finding regarding Terraform Labs’ alleged violations and requested summary judgment on all claims.

An Oct. 27 court filing showed the SEC’s reluctance to accept jury leniency toward Do Kwon and his involvement in facilitating the frauds that ultimately led to the collapse of Terraform Labs. The filing, addressed to the U.S. District Court for the Southern District of New York, reads:

“No rational jury could conclude that Kwon was not liable for Terraform’s violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereof, pursuant to Section 20(a) of the Exchange Act. the Exchange Act.”

“Evidence” of violations provided by the SEC points to Kwon’s involvement in deceiving crypto investors by creating and marketing Terra and its internal Terra tokens (LUNA) as securities.

The SEC seeks summary judgment in the Do Kwon and Terraform Labs case in New York District Court. Source:

The same day, Do Kwon and Terraform Labs asked the judge to dismiss the SEC lawsuit – arguing that Terra Classic (LUNC), TerraClassicUSD (USTC), Mirror Protocol (MIR) and its mirror assets (mAssets) are not securities as the SEC claimed. .

However, the SEC maintains that Kwon and Terraform Labs offered and sold securities, sold LUNA and MIR in unregistered transactions, engaged in transactions involving mAssets, and committed fraud.

Related: Terraform co-founder Shin accuses protocol of collapsing in South Korea trial

While Terra co-founder Daniel Shin’s lawyer blamed the collapse of Terra’s ecosystem on the “unreasonable operation of the Anchor protocol and external attacks led by Do-hyung Kwon,” the company recently placed blame market maker Citadel Securities for its role in an alleged “concerted transaction”. , intentional effort” to cause the depegging of its stablecoin TerraUSD (UST) in 2022.

Screenshot of Terraform’s filing requiring Citadel to provide additional documentation. Source: CourtListener

Citadel Securities told Cointelegraph in a statement: “This frivolous motion is based on false social media posts and ignores information we have already provided confirming that we played no role in this matter. »

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