There could be a summary judgment in the case against Terraform Labs and its founder Do Kwon. The SEC, which is the plaintiff in the case, believes it has been proven that Terraform Labs and Do Kwon, its managing director, are guilty of fraud. The evidence is “clear, undisputed and overwhelming,” the agency said in its statement Application. Therefore, one would like to obtain the conviction through a quick trial – this would make a trial unnecessary.
The chances that Do Kwon will actually be convicted without bureaucracy increase again. Finally, Do Kwon’s lawyer is also pushing for a quick trial. However, it is in the nature of the matter that he wants to obtain an acquittal instead of a conviction. It has not been proven that Do Kwon sold unregistered securities, the defense said.
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Did Do Kwon manipulate the Terra blockchain?
Back in February, the SEC filed a lawsuit against Terraform Labs and Do Kwon. The authority accuses the entrepreneur of forging blockchain activities on the Terra Chain and selling unregistered securities. This refers to the tokens LUNA and MIR. “When this fraud was exposed, investors in Terraform’s crypto securities lost almost everything,” the SEC writes in the lawsuit. Investors lost up to $45 billion.
Do Kwon is currently in custody in Montenegro. The South Korean was arrested for forging documents after he tried to leave the country with a fake passport.
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The demise of Terra Luna in May 2022 is considered, along with the FTX scandal, a defining event of the last bear cycle. Due to the rapid decline in the price of Bitcoin and Co., the stability of the USD stablecoin TerraUSD (TUSD) could no longer be guaranteed. The token lost massive value within hours and ultimately collapsed. In the end, billions were destroyed, the Terra ecosystem was history and Do Kwon was on the run.
It is still unclear whether Montenegro will extradite Do Kwon to the USA if he is found guilty.
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