Chris Amani, the CEO of Terraform Labs, has announced the company’s decision to cease operations after reaching a $4.47 billion settlement with the U.S. Securities and Exchange Commission (SEC).
As part of the plan, Terraform Labs intends to sell off key projects within the Terra ecosystem and transfer control of the Terra (LUNA) blockchain to the community.
The move to dissolve the company comes in the wake of the $4.47 billion settlement with the SEC related to the collapse of the algorithmic stablecoin UST in 2022. This settlement includes a significant disgorgement of $3.58 billion, as well as a civil penalty of $420 million.
Taking over from Do Kwon in July 2023, Amani has confirmed the company’s decision to wind down operations and eliminate unvested and vested holdings.
Amani has also announced plans for a community proposal to burn any remaining vested tokens and emphasized the importance of community-led governance for the Terra and Terra Classic (LUNC) blockchains.
The decision to hand control over to the community has received mixed reactions, with some expressing optimism while others critiquing past leadership. While many support the shift towards community governance of LUNC, one community member’s response to Amani’s announcement has sharply criticized the decision.
Following the news of Terraform Labs’ dissolution, the prices of LUNA and LUNC have dropped by 5% and 2% respectively in the last 24 hours. The $4.47 billion settlement with the SEC sets a significant regulatory precedent for the crypto space, highlighting the importance of regulatory compliance and governance.
In other news, SocialFi is boosting game revenue, while the creator of Axie Infinity is looking to move away from Discord in the Web3 gaming industry.