Do Kwon and Terraform Labs Submit Motion for Case Dismissal against U.S. SEC

Terraform Labs, a prominent stablecoin issuer, has taken a decisive step in its legal battle with the U.S. Securities and Exchange Commission (SEC) by filing for summary judgment. The company, along with its co-founder Do Kwon, seeks to dismiss the regulator’s accusations of engaging in multi-billion-dollar securities fraud.

The motion, presented before Judge Jed Rakoff of the U.S. District Court for the Southern District of New York, challenges the SEC’s ability to provide substantial evidence for their case.

According to Terraform, the SEC failed to establish that the company was involved in the offering of unregistered securities. The motion for summary judgment emphasizes the lack of progress made by the SEC in proving any wrongdoing on the part of Terraform and its co-founder. Terraform’s legal team emphasized a thorough investigation, including depositions and document exchanges, revealing no evidence supporting the SEC’s claims.

The legal conflict stems from the collapse of Terraform’s TerraUSD stablecoin and Luna cryptocurrency in 2022, causing substantial losses. After the collapse, the SEC accused Terraform and Kwon of the unregistered sale of securities, causing investor losses.

Terraform Labs Legal Disputes and Extradition Requests

Terraform’s legal defense aims to dispute the credibility of the SEC’s expert opinions, challenging the analysis’s validity. Additionally, Kwon’s legal team opposes the SEC’s U.S. summons, citing his detention in Montenegro and extradition complexities.

The SEC has refrained from commenting on the recent filings. Meanwhile, the legal battle between Terraform Labs and the SEC raises critical questions about the regulatory oversight of digital assets and the obligations of crypto companies in the evolving landscape of the cryptocurrency industry.

The court’s decision on Terraform’s motion for summary judgment will significantly impact the trajectory of the ongoing legal dispute, shedding light on the complex regulatory challenges faced by the crypto industry.