Chris Amani, the CEO of Terraform Labs, has made the announcement that the company will be shutting down operations after reaching a $4.47 billion settlement with the United States Securities and Exchange Commission.
As part of their plan, Terraform Labs is looking to sell off key projects within the Terra ecosystem and transfer control of the Terra blockchain to the community.
The decision to dissolve Terraform Labs comes after the company’s settlement with the SEC over the collapse of the algorithmic stablecoin TerraUSD (UST) in 2022. The settlement includes a disgorgement of $3.58 billion and a civil penalty of $420 million.
Chris Amani, who took over from Do Kwon in July 2023, confirmed the company’s intention to wind down operations and burn both unvested and vested holdings.
In addition, Amani has outlined plans for a community proposal to burn remaining vested tokens and emphasized the importance of community-led governance for the Terra and Terra Classic blockchains.
The decision to hand control over to the community has received a mixed response, with some expressing optimism while others critiquing past leadership. While many support the shift towards Terra Classic, there has been criticism of the decision made by one community member in response to Amani’s announcement.
Following Terraform Labs’ decision to dissolve, the prices of LUNA and LUNA have fallen 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, emphasizing the importance of regulatory compliance and governance.
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