SEC Approves Do Kwon and Terraform Labs Trial Delay Request

The commission opposed the requested separate trials for Terraform and Kwon, asserting the inconvenience it would impose on the process.

Sec Gary Gensler on the case of crumbling Terra Luna.
Created by Kornelija Poderskytė from DailyCoin
  • The Securities and Exchange Commission has filed a new motion in the ongoing legal battle with Do Kwon and Terraform Labs.
  • The commission has granted the defendant’s request for a postponed trial.
  • Do Kwon is presently held in a Montenegro prison.

The Securities and Exchange Commission (SEC) has recently intensified its long-standing legal battle against Do Kwon and Terraform Labs in pursuit of justice for the alleged manipulation that triggered the collapse of TerraUSD and a staggering $60 billion loss for the industry.  

Despite the SEC securing a ruling favoring its claims of Terra’s securities law violations and a trial schedule, the disgraced crypto mogul seeks to delay his fate further, filing for the postponement of the imminent trial.

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In a surprising turn of events, the SEC has expressed support for the proposed rescheduling.

SEC Open to Delay Do Kwon’s Trial

In a filing to U.S. District Judge Jed Rakoff on Monday, January 15, the Securities and Exchange Commission consented to TerraLabs and Do Kwon’s request to adjourn its scheduled January 29 trial.

The commission asserted that while it is “fully prepared, willing, and able to proceed” with a trial against Kwon as scheduled, it acknowledges the necessity of Kwon’s physical presence, requesting that the trial commences on April 15, 2024.

Extract from the SEC's filing to Judge Jed Rakoff.

While the SEC favored one part of the defendant’s requests for trial adjournment, it opposed the requested separate trials for Terraform and Kwon. The commission argued that the cases are the same, highlighting the potential burden and inconvenience separation would impose on witnesses and whistleblowers.

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The final decision on the trial date rests with U.S. District Judge Jed Rakoff, which will determine when the controversial Terra founder faces the long-standing charges.

Do Kwon vs. SEC 

In February 2023, the U.S regulatory commission initiated legal proceedings against Terraform Labs and Kwon, alleging the orchestration of a “multi-billion dollar crypto asset securities fraud” involving an algorithmic stablecoin and other crypto asset securities.

The commission asserted that Kwon deceptively touted UST to investors to earn a profit, misleading them about its stability and credibility.

To evade authorities, Kwon employed a series of elusive maneuvers, posing a challenge to the SEC’s efforts to bring him to justice before landing in a Montenegro prison on charges of travel document forgery.

Both Singapore and South Korea have also launched probes into Do Kwon and have requested his handover to hold him accountable for financial fraud.

On the Flipside

  • Given Kwon’s reputation for maneuvers, he might pull another strategy to delay or potentially alter his fate in the coming months.
  • Do Kwon’s four-month sentence in Montenegro is expected to end in February 2024.
  • The Terraform Labs co-founder faces up to 40 years behind bars if convicted.

Why This Matters

The SEC’s decision to support the proposed trial rescheduling underscores its determination to secure Kwon’s presence in court and accountability for the May 2022 financial ruin.

Read more on Do Kwon’s efforts to delay and alter his fate:
Do Kwon Scores Victory in Extradition Request Appeal 

U.S financial figure weighs in on crypto’s stability, find out more:  
IMF Chair Asserts Crypto Is Not Money Amid ETF Buzz

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Grace Abidemi

Grace Abidemi, a cryptocurrency reporter at DailyCoin, covers industry developments and trends. She previously worked as a freelance writer. With a Bachelor's degree in German Language and certifications in marketing and storytelling, Grace creates engaging content. When not working, she's in Nigeria, mastering cooking and canvas painting, and enjoys learning about different cultures and languages.