Terraform Labs Commits Continuity of Operations Amid Filing for Bankruptcy Protection
Posted: Jan 22, 2024 10:45 AM Updated: Jan 22, 2024 10:45 AM
Correction and fact check date: January 22, 2024, 10:45 a.m.
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Terraform Labs announced that it will continue to operate and meet all financial obligations despite filing for bankruptcy.
Terraform Labs, a blockchain company co-founded by Do-Kwon Kwon and Daniel Shin, announced that it will continue to operate and meet all financial obligations to its employees and suppliers. The announcement comes as the company filed for Chapter 11 bankruptcy protection earlier today in the U.S. Bankruptcy Court for the District of Delaware.
The filing allows Terraform Labs to implement its business plan amid ongoing legal proceedings, including a representative lawsuit in Singapore and a U.S. lawsuit involving the Securities and Exchange Commission (SEC). According to the company, this move will resolve outstanding legal issues while facilitating continued operations and support for the Terra community.
The company estimates its liabilities and assets to be between $100 million and $500 million.
“Terra communities and ecosystems have demonstrated unprecedented resilience in the face of adversity, and this action is necessary to ensure we can continue to work toward our common goals while resolving the legal issues that remain unresolved. This step protects our ability to continue collaborating with the community on infrastructure, innovative tools and products, and other ecosystem support,” Chris Amani, CEO of Terraform Labs, said in a written statement. “We have overcome serious challenges before, and despite long odds, the ecosystem has survived and even grown in new ways post-depeg. “We look forward to successfully resolving the outstanding legal proceedings,” he said.
The company’s comments further follow its acquisition of cross-chain portfolio manager and data provider Pulsar Finance and the launch of Station v3, a cross-chain wallet that enables seamless multi-chain token swaps, transfers, and gas fee token tops. We will continue to expand our Web3 offering with -ups, advanced cross-chain transaction history, and enterprise protocol cross-chain staking upgrades.
Founded in 2018 and headquartered in Singapore, Terraform Labs is an open source software development company specializing in blockchain technology. The company has developed an end-to-end Web3 experience encompassing blockchain, wallet, block explorer, RPC solution, app suite, and various developer tools.
Focused on fostering the growth of the decentralized economy, Terraform Labs is a key contributor to the Terra blockchain and the creators of products and tools such as Alliance, Station, Enterprise, and Warp.
Terraform Labs faces legal challenges
In May 2022, the Terra ecosystem suffered a serious disruption. After the company went bankrupt, co-founder Dodo Kwon was arrested in Montenegro in March 2023 for attempting to leave the country.
The U.S. SEC filed a civil suit against Terraform Labs and Do Kwon in February 2023, alleging that the two parties facilitated a “multibillion-dollar cryptocurrency asset securities fraud” involving tokens previously known as UST and Terra (LUNA). criticized. Currently, both the United States and South Korea are seeking Do Kwon’s extradition, leading to speculation that multiple sentences may be imposed in both countries.
Recently, the SEC agreed to postpone the civil trial against Terraform Labs and its co-founder Dohyun Kwon. The decision to postpone the trial is to facilitate Mr. Do-Kwon’s extradition from Montenegro so that he can participate in the proceedings in the United States.
While filing for bankruptcy protection, Terraform Labs maintains its operating activities despite legal challenges and upcoming trial, emphasizing its commitment to the community and continued expansion.
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About the author
Alisa is a reporter for Metaverse Post. She focuses on everything related to investing, AI, metaverse, and Web3. Alisa holds a degree in Art Business and her expertise lies in the fields of art and technology. She developed a passion for journalism through her work with VCs, notable cryptocurrency projects, and science writing. You can contact us at (email protected).
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alice davidson
Alisa is a reporter for Metaverse Post. She focuses on everything related to investing, AI, metaverse, and Web3. Alisa holds a degree in Art Business and her expertise lies in the fields of art and technology. She developed a passion for journalism through her work with VCs, notable cryptocurrency projects, and science writing. You can contact us at (email protected).
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