Terra officially closes its doors after paying a million-dollar fine

Terra (LUNA), one of the most promising crypto projects in 2022, experienced a dramatic collapse after reaching a peak of $120 per unit, then collapsing and leaving millions of investors with absolute losses on their savings.

As a result, its founder, Do Kwonwas declared guilty by the justice of the USAwhich requested his extradition after being arrested in Montenegro.

After several twists and turns, the parent company, Terraform Labswas forced to pay a fine exceeding US$5,000 million.

Terra officially closes its doors after paying a million-dollar fine

The final sentence was presented by the United States Securities and Exchange Commission (SEC) and accepted by the financial company, which confirmed the official cessation of operations once it pays the fine. This was confirmed by the company’s current CEO, Chris Amani, who succeeded Kwon in July 2023.

The agreement adds a additional amount of US$204 million in fines for Kwonand will prevent you from becoming an officer or director of any publicly traded company.

Terraform Labs and Do Kwon were convicted of civil fraud to users who chose the decentralized finance firm to deposit their savings, with investments that promised inflated returns for the crypto ecosystemthrough its algorithmic stablecoin, TerraUSD (UST).

Do Kwon, co-founder of Terra

The SEC accused the parties of misleading investors by claiming that the value of their stablecoin was governed by parity with the US dollar.

In this way, the amounts to be paid will be used to compensate users, to face sanctions and to pay interest prior to the ruling.

“The proposed consent judgment addresses the magnitude of this fraud by imposing significant corrective, punitive and deterrent remedies, including a multimillion-dollar judgment against the defendants, and provides for a significant and swift recovery for victim investors who collectively lost billions of dollars.” , the SEC said in a statement.

The firm is considering the possibility of carrying out a community proposal, in the style of a DAO, to burn all LUNA tokens, native to Terrain possession of the platform. “Anything left in our wallets will be burned by TFL,” Amani described in X.

“The community will have to take ownership of the chain,” the CEO added, committing to definitively end the entity’s direct involvement with the token.

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