The U.S. Securities and Exchange Commission (SEC) has charged Singapore-based Terraform Labs and its chief, Kwon Do-hyung, with multi-billion dollar crypto asset securities fraud.
The SEC alleges that Terraform and Kwon raised billions through unauthorized offerings and selling of crypto asset securities, including Terra USD and LUNA, while failing to provide full, fair, and truthful disclosure to investors.
The SEC further claims that Terraform and Kwon deceived investors by falsely claiming that a mobile payment app in South Korea used Terra blockchain.
The SEC’s charges serve as a reminder to investors to conduct due diligence before investing in crypto asset securities.
The collapse of Terraform Labs’ crypto project in May 2022 highlights the importance of transparency and trustworthiness in the crypto industry.