Sign Up on MEXCTerraform Labs Advocates for Jury Trial in Token Securities Case
Terraform Labs, known for its involvement with the UST stablecoin and LUNA cryptocurrency, has requested a New York judge. The company seeks a jury trial to determine the regulatory status of its tokens, diverging from the Securities and Exchange Commission’s (SEC) preference for a judicial ruling.
In February, the SEC filed a lawsuit against Terraform Labs and its co-founder, Do Kwon. The allegations centered on raising billions from investors through what the SEC termed “offering and selling an inter-connected suite of crypto asset securities, many in unregistered transactions.” This move sparked a contentious debate over the nature of these digital assets.
The Argument for a Jury Decision
Terraform Labs’ attorney, David Kornblau, emphasized in a letter to Judge Jed Rakoff the importance of a jury determining whether the SEC has convincingly proven that UST, LUNA, wLUNA, and MIR tokens are indeed securities. This request follows a precedent set in the 2021 Audet vs. Fraiser case, where a jury verdict was pivotal in determining the nature of four crypto assets. Consequently, Terraform Labs is leveraging this case to support its argument.
Contrary to Terraform’s position, the SEC argues that the uniqueness of the Audet vs. Fraiser case should not set a standard for jury involvement in such matters. The agency maintains that the facts clearly show Terraform Labs’ involvement in selling securities.
The outcome of this legal battle could have far-reaching implications for the cryptocurrency industry, especially regarding applying the Howey test to determine if a token is an investment contract.
Developments Around Terraform Labs’ Co-founder
Adding to the case’s complexity, Do Kwon, Terraform Labs’ co-founder, faced legal troubles. Arrested in Montenegro in March for using a fake passport, he was recently approved for extradition in late November. This development adds another layer to Terraform Labs’ legal challenges unfolding narrative.
Should the judge agree to Terraform Labs’ request, the case could set a significant precedent in how crypto assets are classified in legal terms. Whether these tokens are securities could influence the future regulatory landscape for digital assets, impacting how they are managed, traded, and perceived in the broader financial ecosystem.
Read Also: Hong Kong SFC Alerts Public on HongKongDAO and BitCuped Scams
- Bitcoin Will 200x From Here, Twenty One Capital CEO Says as BTC Breaks $117K After Fed Rate Cut
- BNB Chain Takes Lead in RWA Tokenization, Expert Sees BNB Rally to $1,300
- Grayscale’s GDLC Fund Holding SOL and ADA Gets SEC Nod for NYSE Debut
- Crypto Market Rally: Will Bitcoin Catch Up With S&P 500 Gains After Fed Rate Cut?
- Ripple Partners DBS, Franklin Templeton To Launch Trading And Lending Backed by RLUSD
- Toshi Coin Gains 57% in One Day: What’s Driving the Sudden Upside?
- Shiba Inu Price Set to Soar as Exchange Reserves Dive Amid SHIB ETF Chatter
- Pepe Coin Price Prediction as Whale Moves $25M From Robinhood- Is a Breakout to $0.00002 Next?
- XRP Price Prediction as Market Longs Hit 78% amid VivoPower Treasury Expansion Launch — Is $4 Next?
- SHIB Price Forecast: Taker Buys Lead as Developers Counter Shibarium Exploit
- Solana Price Set for a 25% Jump as Open Interest Nears a $20 Billion Milestone
Why Trust CoinGape
CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
