Crypto Flexs
  • DIRECTORY
  • CRYPTO
    • ETHEREUM
    • BITCOIN
    • ALTCOIN
  • BLOCKCHAIN
  • EXCHANGE
  • TRADING
  • HACKING
  • SLOT
  • CASINO
  • SUBMIT
Crypto Flexs
  • DIRECTORY
  • CRYPTO
    • ETHEREUM
    • BITCOIN
    • ALTCOIN
  • BLOCKCHAIN
  • EXCHANGE
  • TRADING
  • HACKING
  • SLOT
  • CASINO
  • SUBMIT
Crypto Flexs
Home»ALTCOIN NEWS»Do Kwon’s Fallout: Terraform Labs Shuts Down After $4.47 Billion in Fines
ALTCOIN NEWS

Do Kwon’s Fallout: Terraform Labs Shuts Down After $4.47 Billion in Fines

By Crypto FlexsJune 18, 20243 Mins Read
Facebook Twitter Pinterest LinkedIn Tumblr Email
Share
Facebook Twitter LinkedIn Pinterest Email
  • The closure of Terraform Labs and the $4.47 billion SEC settlement have revealed the consequences of cryptocurrency fraud.
  • The incidents involving Kwon, Zhao and Bankman-Fried highlight the need for increased scrutiny of cryptocurrencies.

While the successful launches of various cryptocurrency projects have been making headlines, the downfalls of some failed cryptocurrency companies have also attracted much attention.

The Fall of Terraform Labs

Terraform Labs, now led by CEO Chris Amani, announced its closure following a significant $4.47 billion settlement with the SEC.

This turn of events has focused attention on Do-Do Kwon, founder of Terraform Labs, which developed one of the popular US-pegged stablecoins.

Kwon’s trajectory, once riding high with massive venture capital and billions of dollars worth of his coins Terra and Luna, now faces similar scrutiny as other notable figures in the cryptocurrency space.

Giving further insight into this, a reporter from ‘The Street’ noted:

“Last April, a jury unanimously found Mr. Kwon and Terra Labs guilty of securities fraud. Mr. Kwon went into hiding for years after the implosion of two digital stablecoins, Luna and Terra.”

The reporter revealed the reason for Terrform Labs’ downfall, adding:

“While stablecoins are based on actual physical assets, Kwon’s coin appears to be based on a complex web of code. “When the algorithm failed in 2022, $40 billion in market value was wiped out.”

The scam included misleading investors about the stability of Terraform’s blockchain and its cryptocurrency UST.

When UST lost its peg to the U.S. dollar in May 2022, its value and that of Terraform’s other tokens plummeted, wiping out about $40 billion in market value.

Gensler’s frustration with this issue

This resulted in significant financial losses for investors, including retail investors who trusted Terraform Labs’ disinformation, further accelerating the collapse of hedge funds and sending investors running for the exits.

SEC Chairman Gary Gensler expressed concern about this in a press release:

“This case confirms what the courts have said: Economic realities, not a product’s label, description, or hype, determine whether that product is a security under the securities laws.”

similar story

Kwon is not the only person embroiled in controversy. Changpeng Zhao, former CEO of Binance, the world’s largest cryptocurrency exchange, was sentenced to four months in prison in April.

Zhao was also forced to give up assets totaling $4.3 billion after being found guilty of money laundering.

Additionally, FTX CEO Sam Bankman-Fried was sentenced to 25 years in prison in March on fraud and conspiracy charges, and a judge ordered $11 billion in assets seized.

These legal actions highlight the ongoing regulatory scrutiny and consequences within the cryptocurrency industry.

Sharing his thoughts on the same, Gensler put it best when he asserted:

“Their fraudulent actions serve as a reminder that investors are harmed when companies do not follow the law. Terraform and Kwon fought investigative efforts all the way to the Supreme Court over investigative subpoenas. Thankfully, with this settlement, victims of large-scale fraud will now receive some justice.”

Next: SEC Cryptocurrency Director David Hirsch Resigns, Community Reacts

Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Posts

Binance explodes 466m LUNC with oblivion: revival play or special effect?

September 4, 2025

Defi Surges, BTC Swings & Tradfi faces freezing: Daily encryption failure

August 28, 2025

Keepsolid launches KS COIN: Loyalty encryption through actual utility token benefits

August 14, 2025
Add A Comment

Comments are closed.

Recent Posts

NOWPayments To Participate In SiGMA Europe Rome 2025

September 4, 2025

Web3 Enabler Announces Blockchain Payments V3.1 At Northeast Dreamin In Boston

September 4, 2025

Is XRP The Dark Horse Of The Cryptocurrency World? Earn 652 XRP Daily Using Invro Mining’s Smart Contract

September 4, 2025

TRX Was Early, ETH Set The Standard, BNB Built The Scale- Now SYC Brings The Next Evolution

September 4, 2025

Sign Up And Receive $500 Bonus, Ushering In A New Era Of Compliant And Secure Crypto Investment

September 4, 2025

Why experts say that 99%of the traders are wrong

September 4, 2025

ChainUp Named Double Finalist At Thomson Reuters’ ALB Pan-Asian Regulatory Awards 2025

September 4, 2025

Integrated security classes can accelerate the adoption of institutional passwords.

September 4, 2025

Binance explodes 466m LUNC with oblivion: revival play or special effect?

September 4, 2025

Cardano founder says Chainlink quotes ‘ridiculous price’ to them.

September 3, 2025

Acurast launches ‘Staked Compute’ and challenges AWS, Azure and Google Cloud using the distributed smartphone network.

September 3, 2025

Crypto Flexs is a Professional Cryptocurrency News Platform. Here we will provide you only interesting content, which you will like very much. We’re dedicated to providing you the best of Cryptocurrency. We hope you enjoy our Cryptocurrency News as much as we enjoy offering them to you.

Contact Us : Partner(@)Cryptoflexs.com

Top Insights

NOWPayments To Participate In SiGMA Europe Rome 2025

September 4, 2025

Web3 Enabler Announces Blockchain Payments V3.1 At Northeast Dreamin In Boston

September 4, 2025

Is XRP The Dark Horse Of The Cryptocurrency World? Earn 652 XRP Daily Using Invro Mining’s Smart Contract

September 4, 2025
Most Popular

Will Solana price remain at $180 after weekly DApp volume drop of 30%?

December 28, 2024

How Cryptocurrency and Blockchain Shape Sports Betting

February 21, 2024

Bitcoin bulls lead with SOL, AR, GRT and FTM flash bullish signals.

May 19, 2024
  • Home
  • About Us
  • Contact Us
  • Disclaimer
  • Privacy Policy
  • Terms and Conditions
© 2025 Crypto Flexs

Type above and press Enter to search. Press Esc to cancel.