Terraform Labs Submits Bankruptcy Protection Application

Terraform Labs, the company behind the once-renowned LUNA-UST projects, has filed for bankruptcy protection in the United States.

Terraform Labs Submits Bankruptcy Protection Application_65bad0688a9fa.webp

Terraform Labs Submits Bankruptcy Protection Application

Terraform Labs, the developer behind the once-prominent projects LUNA and the UST stablecoin, which experienced a downfall during the recent market downtrend in May 2022, has officially filed for bankruptcy in the Delaware court in the United States.

In the bankruptcy filing, the company disclosed that both its assets and liabilities fall within the range of $100 million to $500 million.

Terraform Labs files for bankruptcy protection in US https://t.co/u6chgA5AfK pic.twitter.com/uoykjtorhc

— Reuters (@Reuters) January 22, 2024

This bankruptcy announcement comes as Terraform Labs prepares to enter court proceedings against the U.S. Securities and Exchange Commission (SEC). According to reports from azc.news, the U.S. court has sided with the SEC, recognizing the argument that LUNA and UST are securities. Consequently, Terraform Labs is accused of violating U.S. law by offering these tokens to U.S. investors without SEC approval.

However, the recent court session has been postponed to late March to await the participation of Terraform Labs’ co-founder, Do Kwon, who is currently detained in Montenegro with an unclear release date.

Initially, Terraform Labs attributed the collapse of LUNA-UST to external actors, alleging foul play by investment funds such as Citadel Securities. However, they failed to provide specific evidence and faced immediate rebuttal.

Apart from Terraform Labs, another closely associated investment fund with the LUNA-UST model is Jump Crypto, and its leader Kanav Kariya is also under SEC investigation for allegations of market manipulation and misleading investors about the true nature of the project.

Related: The Trial of Do Kwon in the United States has Been Postponed

The chart of LUNA following the news of Terraform Labs filing for bankruptcy protection

terraform labs submits bankruptcy protection application 65bad0688dfd3

The 1-hour chart of the LUNA/USDT pair on the Tradingview at 03:27 AM on January 22, 2024.

(100 votes)

5.0/5

(100 votes)

Latest

18 Wallets Dump 890 Million Tokens, Astra Nova Crashes 65%

News | Altcoin | Editor Choice

18 Wallets Dump 890 Million Tokens, Astra Nova Crashes 65%

After 18 wallets suddenly dumped 890 million RVV tokens worth over $10.6 million, the Astra Nova team was forced to launch an emergency token buyback program to calm the community.

Binance Deletes 600 Accounts For Exploiting Trading Bots

News | Editor Choice | Policy & Regulations

Binance Deletes 600 Accounts for Exploiting Trading Bots

Binance, the world’s largest cryptocurrency exchange, has taken a tough stance—blocking more than 600 user accounts accused of exploiting its Binance Alpha platform through coordinated automated bot activity.

Over $3 Million In Xrp Stolen, What Really Happened

News | Editor Choice | Policy & Regulations

Over $3 Million in XRP Stolen, What Really Happened?

An XRP investor in the U.S. has lost more than $3 million despite storing his assets in a cold wallet — a shocking incident that has shaken the crypto community and raised serious concerns about security vulnerabilities in so-called “safe” storage devices.

Ai Boom Propels Bitcoin Miners To 500% Gains, Outpacing Btc Itself

News | Bitcoin | Editor Choice

AI Boom Propels Bitcoin Miners to 500% Gains, Outpacing BTC Itself

AI-fueled revenues keep miners resilient — could that stability lift Bitcoin out of its October slump?

Bnb Plunges After Being Added To Coinbase’s Listing Roadmap

News | Altcoin | Editor Choice

BNB Plunges After Being Added to Coinbase’s Listing Roadmap

BNB’s price has tumbled sharply in recent days, despite the positive news that the token is set to be listed on Coinbase.

Screenshot 2025 10 20 091338