- The SEC is blaming Terraform Labs and Do Kwon for misleading investors about Chai Corp’s use of TFL technology and the dependability of UST stablecoin through LUNA and UST fraud.
- The trial’s result may affect Terra Lab’s tokens, LUNA and LUNC, due to technological advances and the burning of over 105 billion LUNC tokens.
There is a sense of expectation in the courtroom as Terraform Labs and its elusive founder, Do Kwon, appear before the U.S. Securities and Exchange Commission (SEC). Judge Rakoff is presiding over the trial, which is centered on claims that have the potential to alter the stability and laws around cryptocurrencies.
Tone is Set by the Judge’s Rebuke
In response to Judge Rakoff’s request for clarification, the SEC made allegations of deceptive schemes by Terraform Labs and Kwon. The SEC focused on misrepresenting claims regarding Chai Corp’s involvement and the purported stability of the TerraUSD stablecoin, which it promised would remain stable against the US dollar.
A shadow hangs over the proceedings as Terraform Labs fights the civil fraud allegations related to the demise of TerraUSD due to Kwon’s absence—he is awaiting extradition in Montenegro.
The Ripple Effect on LUNA and LUNC Valuations
This legal battle has shaken the cryptocurrency world and sparked discussions about what this means for Terra’s tokens, LUNA and LUNC, in light of recent technological advancements and Binance’s well-publicized LUNC token burns, as previously reported by ETHNews.
Recent Terra Luna Classic updates, such as version 2.4.2 with IBC-Hooks, drove the LUNA token price to a 7-day high of $1.182606
With a market capitalization of $902.48 million and a price of $0.0001547, which has fallen by 0.81% in the last 24 hours, the market is closely monitoring LUNC. The rising number of LUNC wallet users and a positive Fear & Greed Index rating indicate an upbeat market sentiment.
The trial’s verdicts, however, are significant and might have an impact on the token’s future as well as the cryptocurrency market as a whole.