Key Takeaways:
- $4.47 Billion Settlement: Terraform Labs settles with the SEC for $4.47 billion after being found liable for the Terra ecosystem collapse, which led to a $40 billion investor loss.
- Operational Changes: Terraform Labs will cease operations, sell key projects, and hand over control of the Terra blockchain to the community as part of the settlement.
- Ripple Case Reference: Ripple’s legal team cites the Terraform settlement, arguing for a reduced civil penalty in their own SEC dispute, countering the SEC’s proposed $2 billion penalty with a maximum of $10 million.
Terraform Labs has agreed to a $4.47 billion settlement with the SEC following a jury’s finding of their liability for the collapse of the Terra ecosystem, which caused a $40 billion loss in investor assets.
As part of the settlement, Terraform Labs will cease operations, sell key projects, and transfer control of the Terra blockchain to the community.
Terraform Labs has agreed to pay nearly $4.5 billion to settle a lawsuit filed by the SEC. pic.twitter.com/FoxvSSFEEJ
— TheStreet (@TheStreet) June 17, 2024
In a related case, Ripple’s lawyers have requested a court to consider an “appropriate” civil penalty in its ongoing dispute with the SEC, referencing the recent Terraform settlement.
Assuming Terraform Labs actually has $4.47 billion to pay… why is that capital going to a soulless government agency vs being used to compensate Terra’s victims?
— Zach Rynes | CLG (@ChainLinkGod) June 12, 2024
Is this what ‘protecting investors’ is supposed to look like? If so, I’d like to opt out, thanks https://t.co/nvSdJqnU2i
The SEC proposed Ripple pay around $2 billion in penalties, but Ripple argues for no more than a $10 million penalty.
If Terraform Labs ACTUALLY has $4.5B in assets…
— DavidHoffman.eth/acc🦇🔊 (@TrustlessState) June 12, 2024
and if it ACTUALLY is paid as a fine to the @SECGov, instead of the users who lost money….
It'll be one of the craziest examples of agency corruption in our lifetimes
The SEC contends that a proportional penalty based on Ripple’s $876.3 million in gross profits should be $102.6 million, aligning with Terraform’s penalty ratio.
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