Terraform Labs Faces $57 Million Class-Action Lawsuit in Singapore High Court – Coinpedia Fintech News
In a Singapore High Court battle, Terraform Labs and its founder, Do Kwon, are facing the heat as a class-action lawsuit gets a green light despite attempts to push it into arbitration based on website terms. Imagine investing in a promising digital coin only to watch its value crash overnight.
That’s the story for 375 individuals who lost a staggering $57 million due to a stablecoin’s unexpected plunge away from the U.S. dollar in May 2022. Now, they’re spearheading a legal crusade against Terraform Labs, accusing them of foul play with their crypto. Exciting, yet quite intense!
Legal tango, class-action suit Terra Now—what’s happening?
As per the latest reports, Julian Moreno Beltran and Douglas Gan are leading all those affected 375 people, alleging a whopping $57 million loss due to issues with terraUSD (UST), Terraform’s digital currency. But this case isn’t just about these investors; it’s a significant event for the entire crypto world, possibly setting new legal standards for the industry.
Mahesh Rai, a director at Drew & Napier, and the legal representatives for the claimants, emphasized the significance of this legal milestone. Rai noted that this lawsuit’s progression to this stage marks uncharted territory in the world of class-action suits related to crypto, pushing it further toward the discovery phase.
Drawing parallels to the recent Terraform Labs legal troubles in the United States, where the Securities and Exchange Commission (SEC) has accused the company of selling unregistered securities. Terraform had previously sought to dismiss this case, citing the regulator’s failure to substantiate its claims. Despite these legal challenges, Terraform Labs has yet to provide additional commentary on these ongoing matters.
All Rests on the court’s Decision!
The court initially denied Terraform’s request for arbitration due to a lack of evident agreement between the company and the claimants. Even though Terraform showed a possible arbitration agreement, the court noted its actions in the legal proceedings, which implied acceptance of the court’s jurisdiction. Despite appeals and case management efforts, the delays in addressing the jurisdictional challenge were deemed regrettable by the judge, who emphasized the need for faster resolution under new legislation introduced to expedite legal processes in Singapore.
Hence, this high-stakes legal tango reflects the urgent need to redefine legal issues in the crypto world and how to resolve them with clarity.
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