In the United States, hearings on the SEC's civil complaint against Terraform Labs and its co-founder Do Kwon have ended. The company and Kwon were found guilty of luring and defrauding investors.

The jury in the District Court for the Southern District of New York took very little time to deliberate on the civil case, SEC Enforcement Director Gurbir Grewal said. Do Kwon and his company, Terraform Labs, were found guilty of fraud. At the same time, the trial itself took place in absentia, and Kwon remains in Montenegro while there are disputes about his extradition to the United States.

“We are pleased with today's jury verdict of a massive cryptocurrency fraud. Terraform Labs and its former CEO Do Kwon deceived investors about the stability of crypto assets and the so-called algorithmic stablecoin Terra USD. They also misled investors about whether a popular payment app was using the company's blockchain to process payments,” Grewal said.

The official also noted the lack of registration of Terraform Labs with US regulators, which “led to extremely dire consequences” for investors. During the trial, SEC lawyers called the platform a “house of cards.” The court decision found that Kwon and Terraform Labs were guilty of six counts of fraud. The jury also wrote that the platform “recklessly” lured investors with false statements regarding the sale of Terra USD, LUNA and wLUNA.

The start of the trial against the Singapore platform and Do Kwon was reported on March 25.