Bankrupt Terraform Labs is shedding four subsidiaries as part of a court-mandated wind-down following its multi-billion dollar settlement with the U.S. Securities and Exchange Commission (SEC).
The company announced on July 9th that it’s actively seeking buyers for Pulsar Finance (portfolio tracker), Station (crypto wallet), Enterprise (DAO management platform), and Warp (smart contract automation protocol). Notably, Terraform acquired Pulsar Finance just months before filing for Chapter 11 bankruptcy in January 2024.
This asset sale aims to maximize returns for creditors and stakeholders while adhering to the SEC settlement terms. Last month, Terraform agreed to a hefty $4.5 billion settlement, including disgorgement, civil penalties, and pre-judgment interest. Do Kwon, Terraform’s co-founder, also faces a separate financial penalty as part of the deal.
The SEC lawsuit centered on accusations of securities fraud related to Terraform’s cryptocurrency ecosystem, specifically the algorithmic stablecoin TerraUSD (USTC, formerly UST) and its interconnected token Terra Luna Classic (LUNC). The May 2022 collapse of USTC’s dollar peg triggered a “death spiral” for both tokens, causing their prices to plummet.
Also Read: LUNC Price to Skyrocket Post Terraform Labs Shutdown? Analyst Predicts X% Surge Due to Token Burn
Despite the sale of these assets, Terraform Labs continues development on Warp and Station, with the last updates occurring earlier this year. The fate of the newly minted Luna token (LUNA) remains uncertain, with its price showing minimal reaction to the news and remaining down significantly from its 2022 peak.
Potential buyers interested in acquiring any of Terraform’s subsidiaries can contact the company’s investment banker, CAVU Securities. This move marks a significant chapter in the ongoing saga surrounding Terraform Labs and its cryptocurrency projects.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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