Terra community gets chain after TFL phase-out; Coinbase exec slams SEC settlement

Chris Amani, CEO of Terraform Labs, said Terra will become a community project as the company shuts down following a $4.5 billion SEC settlement.

Amani wrote on June 12 that the community “must take ownership of the chain.” He said that certain teams and developers want to handle the project and will announce their intentions on the forums.

Amani added that Terraform Labs “always intended to solve” and can now do so.

He said the company was “well positioned to accelerate” had it won the SEC case, but can no longer operate because it lost the lawsuit.

Terraform Labs will continue to operate its products during the wind-down period.

The company will sell Pulsar Finance, a cross-chain portfolio manager it acquired in late 2023, and two other products, Station Protocol and Enterprise Protocol.

In addition, Amani announced that TFL will post a proposal to burn all its non-established Luna. The company will also propose to burn all established cryptocurrencies it has in its wallet.

Coinbase CLO Rejects Settlement

The settlement has attracted attention elsewhere in the industry. Coinbase CEO Paul Grewal criticized the outcome of the case and emphasized its benefits for the SEC.

Grewal said the outcome “simply makes the SEC an unsecured creditor,” meaning the agency will receive money through Terraform Labs’ bankruptcy case. He added that the company is ordering Terra’s co-founder and former CEO Do Kwon to “hand over $7 million in assets.”

Grewal said:

“It’s predictably on-brand…There’s no meaningful relief for fraud victims. This is no way to regulate.”

Meanwhile, Messari CEO Ryan Selkis also denounced the settlement amount, saying it should go to the victims. reimbursement fund over the SEC. He added that any other outcome should result in SEC Chairman Gary Gary Gensler “going to prison for the rest of his life.”

The SEC’s unsecured creditor claim concerns the majority of the settlement amount. However, injured investors will receive certain assets that Kwon transfers to the Liquidating Trust.

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Assad Jafri

Editor and reporter at CryptoSlate

A passionate journalist since Yemen’s Arab Spring in 2011, AJ has honed his skills globally for more than a decade. Specialized in financial journalism, he now focuses on crypto reporting.