Crypto Flexs
  • DIRECTORY
  • CRYPTO
    • ETHEREUM
    • BITCOIN
    • ALTCOIN
  • BLOCKCHAIN
  • EXCHANGE
  • ADOPTION
  • TRADING
  • HACKING
  • SLOT
  • TRADE
Crypto Flexs
  • DIRECTORY
  • CRYPTO
    • ETHEREUM
    • BITCOIN
    • ALTCOIN
  • BLOCKCHAIN
  • EXCHANGE
  • ADOPTION
  • TRADING
  • HACKING
  • SLOT
  • TRADE
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

SEI tokens have soared more than 100% in June -the highest catalyst explained.

June 26, 2025

$ 438m XRP Transfer Sparks Panic- Ripple?

June 19, 2025

Solana Price Eyes 103% Rally $ 300: Here is the reason.

June 12, 2025
Add A Comment

Comments are closed.

Recent Posts

Safe smart account audit summary

June 27, 2025

CARV’s New Roadmap Signals Next Wave Of Web3 AI

June 27, 2025

CARV’s New Roadmap Signals Next Wave Of Web3 AI

June 27, 2025

Bybit Expands Global Reach With Credit Card Crypto Purchases In 25+ Currencies And Cashback Rewards

June 27, 2025

BYDFi Joins Seoul Meta Week 2025, Advancing Web3 Vision And South Korea Strategy

June 27, 2025

Earns $9,800 Per Day With BTC Breaks Through $107,000, GoldenMining Global Market.

June 27, 2025

Why Bakkt Holdings can buy Bitcoin with a $ 1 billion increase

June 27, 2025

NVIDIA RTX strengthens FITY’s AI -centered innovation in Cooler Design.

June 27, 2025

Join Earn Mining To Mine Easily And Earn $7752 A Day

June 26, 2025

Bitcoin prices return to green -building exercise for more profits

June 26, 2025

Weed® Announces Partnership With Khalifa Kush; Launches Global Commercialization

June 26, 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

Safe smart account audit summary

June 27, 2025

CARV’s New Roadmap Signals Next Wave Of Web3 AI

June 27, 2025

CARV’s New Roadmap Signals Next Wave Of Web3 AI

June 27, 2025
Most Popular

How can I recover my Bitcoin Core wallet after encrypting it with a password?

June 6, 2024

Ross Ulbricht speaks in Bitcoin 2025

April 11, 2025

Confirmation number 25 | Ethereum Foundation Blog

January 15, 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.