Terraform Labs announced its closure following a $4.47 billion settlement with the U.S. Securities and Exchange Commission (SEC) to resolve a fraud case. CEO Chris Amani confirmed the shutdown in a post on X, citing the loss in court as the reason for ceasing operations.
The settlement requires former CEO Kwon Do-hyung to pay $204 million to the bankruptcy estate and bans him from cryptocurrency transactions and executive roles in public firms. The agreement awaits approval from U.S. District Court Judge Jed Rakoff.
Terraform Labs’ stablecoin and related cryptocurrency, LUNA, collapsed in May 2022, causing major disruptions in the crypto market. Kwon, currently in custody in Montenegro for passport fraud, faces additional charges from the U.S. Department of Justice and financial crime allegations in South Korea.
