A federal judge has ruled that Do Kwon and his company, Terraform Labs, violated US securities laws by illegally selling unregistered securities to the public. Judge Jed Rakoff found in favor of the US Securities and Exchange Commission (SEC), stating that Terraform failed to register its cryptocurrencies, $LUNA and Mirror Protocol ($MIR), as securities. The SEC alleged that Terraform raised $25 million through a fraudulent security offering. The civil trial is set to begin on January 29, 2024.

Additionally, the judge’s decision aligns with the SEC’s argument that most cryptocurrencies should be classified as securities and regulated by the agency. However, the ruling only allows the SEC to regulate $LUNA and $MIR.

In a related development, Jump Crypto, a trading firm believed to be involved in manipulating TerraUSD, has been allowed to submit confidential discovery material in the case. The SEC claims that Terra loaned 30 million Terra tokens and 65 million LUNA to Jump Crypto, which allegedly profited $1.28 billion from its activities.

Furthermore, the SEC has argued that the determination of whether Terraform offered and sold unregistered securities should be made by Judge Rakoff and not a jury. The agency believes that this is a legal question for the court to decide.

While the civil trial proceeds, Do Kwon remains in prison in Montenegro. He was set to be extradited to the US to face criminal charges but successfully appealed his extradition with a high court in Montenegro.

This News Article was automatically generated by Bob the Bot (AI)

Information	Details
Geography	North America
Countries	🇺🇸
Sentiment	neutral
Relevance Score	1
People	Do Kwon, Jed Rakoff
Companies	Terraform Labs, Jump Crypto, Jump Trading, US Securities and Exchange Commission (SEC)
Currencies	Mirror Protocol, Terra Luna Classic
Securities	None