### Almost a year after the algorithmic stablecoin lost its peg and billions of dollars in investor funds were wiped out, the Securities and Exchange Commission (SEC) filed a lawsuit against Terraform Labs and its CEO, Do Kwon, accusing them of engaging in cryptocurrency securities fraud. 

According to the SEC's court filing in the Southern District of New York. Do Kwon allegedly made billions of dollars from investors beginning in April 2018 by marketing a variety of digital assets, many of which were unregistered securities.



The loss of the stablecoin's peg and the disappearance of investor cash, according to the SEC, were orchestrated by Terraform Labs and Do Kwon, therefore constitute securities fraud.



Regulators such as the SEC continue to monitor and enforce the law to protect investors and maintain fair and efficient markets but it is important to note that the government agency did nothing when other cryptocurrency businesses like 3AC, Celsius, and FTX collapsed in 2022. After almost a year, the SEC has finally come out from hiding with its announcement that all cryptocurrencies are securities with no proper guidelines at hand.



The allegations of securities fraud against Kwon are simply the SEC's agenda to classify all cryptocurrencies as securities as their momentum in slowing down crypto adoption kicks up as it currently moves forward with its aim to ban crypto staking for retail investors.



The lack of clear regulatory guidance from the SEC in the crypto space has been a point of contention for many in the industry. The SEC's regulation by enforcement approach creates uncertainty and stifles innovation.



The US may be at a disadvantage in terms of adoption of cryptocurrencies if it continues to fall behind in establishing clear regulations for the industry. Some nations, such The United Arab Emirates, Singapore, and Hong Kong, have regulated the cryptocurrency sector more effectively and as a result have emerged as centers of innovation and growth.



 

Almost a year after the algorithmic stablecoin lost its peg and billions of dollars in investor funds were wiped out, the Securities and Exchange Commission (SEC) filed a lawsuit against Terraform Labs and its CEO, Do Kwon, accusing them of engaging in cryptocurrency securities fraud. 

Wed Feb 22 2023

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Wed Feb 22 2023 SEC Cracks Down On Terra's Do Kwon Over Fraud Allegations – Editorial

Ferrari to Accept Crypto Payments in the US; Plans to Include Europe Underway

Prototype Global Cryptoasset Mapping System Developed

FTX Founder Sam Bankman-Fried Sent to Jail for Alleged Witness Tampering

Huobi Rocked by Reports of Executive Arrests and Accusations of Customer Fund Misuse

Breaking The Chains: Introducing BRC-69, The Bitcoin Standard Without Data Restrictions

Prototype Global Cryptoasset Mapping System Developed

Wed Feb 22 2023

SEC Cracks Down On Terra's Do Kwon Over Fraud Allegations – Editorial