Terraform Labs co-founder and CEO Do Kwon has suffered a legal blow as a U.S. judge has denied his request to prevent the U.S. Securities and Exchange Commission (SEC) from obtaining certain documents related to the firm’s operations.
The documents in question are being sought from the Monetary Authority of Singapore (MAS), per a Bloomberg report.
According to court records, the U.S. District Court for the Southern District Judge Jed Rakoff last Friday rejected the request made by Do Kwon and Terraform to compel the Securities and Exchange Commission (SEC) to withdraw its demand for documents held by the Singaporean regulator and the defendants.
Luna Foundation Guard, a fund established to maintain the value of the company’s algorithmic stablecoin Terra USD at $1, is also involved in the case.
SEC Sues Terraform Labs and Founder Do Kwon For Securities Fraud
The U.S. Securities and Exchange Commission on Thursday charged Singapore-based Terraform Labs and founder and CEO Do Hyeong Kwon—better known as Do Kwon—with securities fraud involving its algorithmic stablecoin Terra USD and the LUNA token. The complaint, filed in the U.S. District Court for the Southern District of New York, charges the defendants with violating the registration and anti-fraud provisions of the Securities Act and the Exchange Act. “We allege that Terraform and Do Kwon failed...
The collapse of the Terra ecosystem last May was among the key factors that contributed to the crypto industry’s slide into its crypto winter, with prices of Bitcoin and other major altcoins plunging and several established players, including the crypto hedge fund Three Arrows Capital (3AC), going bankrupt.
The SEC sued Singapore-based Terraform Labs and CEO Do Kwon in February this year, accusing them of securities fraud related to the company’s algorithmic stablecoin Terra USD and its sister token LUNA.
The agency claims Terraform Labs and Do Kwon marketed “crypto asset securities” to investors seeking to profit from investing in Terra UST and related Terra products claiming that the tokens would increase in value.
Do Kwon Arrested in Montenegro, Says Country’s Minister of Interior
Terraform Labs co-founder and CEO Do Hyeong Kwon was reportedly arrested Thursday at an airport in Montenegro’s capital city of Podgorica, according to the country’s Minister of Interior, Filip Adzic. “Montenegrin police have detained a person suspected of being one of the most wanted fugitives, South Korean citizen Do Kwon, co-founder and CEO of Singapore-based Terraform Labs,” he said. Montenegrin authorities are still confirming that the individual arrested is Kwon, based on the claim that th...
The move followed the opening of an investigation into the collapse of Terra and whether its stablecoin violated federal securities regulations in June 2022.
After months on the run, Do Kwon was arrested last month in Montenegro, with the Balkan nation’s police later confirming that both the U.S. and South Korea have requested the extradition of Terra co-founder.
