Terraform Labs files for Chapter 11 bankruptcy in Delaware

Terraform Labs Pte. Lte. According to the Bankruptcy Protection Agency, a Chapter 11 bankruptcy application was filed in the U.S. Bankruptcy Court in the District of Delaware on January 21. Court’s website.

The company’s liabilities are estimated at between $100 million and $500 million, and its assets are in the same range, the filing showed.

Terraform Labs is the company behind algorithmic stablecoin TerraUSD and sister cryptocurrency Luna, which collapsed in May 2022. U.S. Securities and Exchange Commission charged The company’s then-CEO Kwon Do-hyung was accused of fraud in February 2023.

The bankruptcy filing will allow the company to address its ongoing legal issues, including the SEC lawsuit and pending litigation in Singapore, Terraform Labs said in a statement shared with The Block.

“This action protects our ability to continue collaborating with the community on infrastructure, innovative tools and products, and other ecosystem support,” Chris Amani, CEO of Terraform Labs, said in a statement.

Mr. Kwon was arrested in Montenegro in March last year on charges of possessing false documents. former soil Luna

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The chief awaits his extradition, and the U.S. District Court for the Southern District of New York pushed back At Attorney Kwon’s request, the SEC will proceed with a trial against Terraform and Chairman Kwon until the end of March.

Update: More details added to the submission and Terraform Labs’ statement.

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