Terraform Labs and SEC Agree on Protective Order in Civil Case
Terraform Labs and the United States Securities and Exchange Commission (SEC) have reached an agreement on a protective order in their ongoing civil case. U.S. District Court Judge Jed Rakoff has sanctioned this agreement, which mandates that confidential materials will not be disclosed publicly. The court will also seal any discovery filings marked as confidential. Judge Rakoff has expressed that it is unlikely he would unseal these documents without providing further rationale. The protective order was finalized with the consent of both parties’ legal representatives, including Terraform Labs’ co-founder Do Kwon.
SEC Charges Terraform Labs with Securities Fraud
The collapse of Terraform Labs and the depegging of its stablecoin TerraUSD from the U.S. dollar had a significant impact on the cryptocurrency market. In February, the SEC charged Terraform Labs and Do Kwon with conducting a multi-billion dollar crypto asset securities fraud by offering and selling unregistered securities.
The ongoing SEC vs. Terraform civil case has implications for legal precedents in the crypto sector. In a separate ruling, Terra was permitted to issue subpoenas to FTX entities during bankruptcy proceedings. Judge Rakoff also accepted confidential materials from Jump Crypto Holdings for discovery in this case. The outcome of this case will provide crucial legal guidance for companies operating in the crypto space.
SEC’s Regulatory Approach Under Scrutiny
The SEC’s handling of cryptocurrency firms in the United States has faced criticism for its “regulation by enforcement” strategy. The commission has pending cases against major players in the crypto industry, including Binance, Kraken, Ripple, and Coinbase.
Read Also: Binance Removes Cardano, MATIC, Pepe Coin, BTC & 35 Other Liquidity Pools, What It Means?
Hot Take: Terraform Labs and SEC Reach Protective Order Agreement in Ongoing Civil Case
Terraform Labs and the SEC have agreed on a protective order in their civil case, ensuring that confidential materials will not be disclosed publicly. This agreement has significant implications for the legal precedents in the crypto sector. The SEC’s regulatory approach has come under scrutiny, with accusations of “regulation by enforcement” strategy. The outcome of this case will provide crucial legal guidance for companies operating in the crypto space.
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