Terraform founder Do Kwon found liable in SEC’s crypto fraud trial: ‘Built on lies’
NY Post
A jury in Manhattan found Singapore-based Terraform Labs and its founder Do Kwon liable on civil fraud charges on Friday, agreeing with the Securities and Exchange Commission that they misled investors before their stablecoin’s 2022 collapse shocked cryptocurrency markets.
The jury delivered the verdict in federal court after a two-week trial after hearing closing arguments earlier in the day.
The SEC accused the company and Kwon of misleading investors in 2021 about the stability of TerraUSD, a stablecoin designed to maintain a value of $1. The regulator also accused them of falsely claiming Terraform’s blockchain was used in a popular Korean mobile payment app.
SEC attorney Laura Meehan said during closing arguments that the platform’s success story was “built on lies.”
“If you swing big and you miss, and you don’t tell people that you came up short, that is fraud,” Meehan said.
Louis Pellegrino, an attorney for Terraform, told the jury on Friday the SEC’s case relied on statements taken out of context and that Terraform and Kwon had been truthful about their products and how they worked, even when they failed.
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