Terraform Labs Granted Liquidation Approval

On September 19, a bankruptcy court in Delaware approved the liquidation plan for the cryptocurrency firm Terraform Labs as part of its bankruptcy proceedings, according to Reuters.

The judge endorsed the company’s bankruptcy plan, describing it as a “welcome alternative” to further litigation over investor losses.

The decision follows an agreement between Terraform Labs and its co-founder Do Kwon to settle claims with the SEC by paying a $4.47 billion fine.

The regulator has agreed to receive funds after investor losses are compensated. Terraform Labs itself struggled to estimate the total damage. Preliminary estimates suggest the collapsed platform could pay between $184.5 million and $442.2 million to all interested parties as part of the bankruptcy process.

In April, during a court proceeding, a jury found Do Kwon and Terraform Labs guilty of deceiving investors and securities fraud.

In South Korea, the entrepreneur faces numerous charges, including violations of capital market laws.

Earlier, Kwon was released from prison in Montenegro after serving his sentence for attempting to cross the border with forged documents. He is currently awaiting extradition to South Korea.