Genesis Global Entities Ordered to Produce Documents
A judge in the United States has granted a request by Terraform Labs for Genesis Global entities to produce certain documents. The order, issued by Judge Jed Rakoff in the Southern District of New York, states that Genesis has five days to comply with the subpoena. The filing reveals that Genesis failed to provide records by the required date of October 9th. However, it does not specify what documents Terraform is seeking.
The SEC’s Case Against Terraform and Do Kwon
This order is part of the U.S. Securities and Exchange Commission’s (SEC) civil case against Terraform Labs and its co-founder and CEO, Do Kwon. The case was initially filed in February. Kwon is currently serving a prison sentence in Montenegro for using falsified travel documents while the lawsuit against Terra continues in the U.S.
Terra and Kwon Accused of Misleading Investors
The SEC alleges that Terra and Kwon misled and deceived investors with claims about their algorithmic stablecoin, Terra USD (UST). The collapse of Terraform Labs was one of the events that contributed to the crypto market crash of 2022, along with the bankruptcies of other companies like FTX, BlockFi, Celsius Network, and Voyager Digital.
Bankruptcy Protection and SEC Lawsuit
Genesis filed for bankruptcy protection in January, citing liabilities of around $1 billion and assets worth $10 billion at the time. Both Genesis and cryptocurrency exchange Gemini are facing a civil suit from the SEC for allegedly offering unregistered securities through Gemini’s Earn program.
Hot Take: Genesis Global Ordered to Produce Documents as Part of Terraform Lawsuit
A U.S. judge has ruled in favor of Terraform Labs, ordering Genesis Global entities to produce specific documents. This order is part of the ongoing SEC lawsuit against Terraform and its CEO, Do Kwon. The SEC accuses Terra and Kwon of misleading investors with their stablecoin, Terra USD. The collapse of Terraform Labs played a role in the 2022 crypto market crash. Genesis, which filed for bankruptcy earlier this year, has been targeted by the SEC for offering unregistered securities. Compliance with the subpoena will be required within five days.
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