Terraform Labs has agreed to a significant penalty, surpassing the fine imposed on crypto exchange Binance by the U.S. Justice Department. According to court filings on Wednesday, Terraform Labs reached a $4.47 billion settlement with the U.S. Securities and Exchange Commission (SEC) concerning the collapse of TerraLuna (LUNC) and TerraUSD (UST).

The proposed penalty, submitted by SEC prosecutors, followed a two-week trial in March and a preliminary agreement disclosed in the previous month. A jury determined that both Terraform Labs and its founder, Do Kwon, were legally accountable for the company’s 2022 crash.

This settlement, pending approval from a New York judge, could become one of the largest between a crypto entity and a U.S. regulator. Initially, the SEC sought $5.3 billion in fines from both parties. Federal prosecutors initially argued for $4.7 billion in disgorgement, accompanied by $520 million in civil penalties from the firm and Kwon.

Do Kwon is also awaiting extradition in the Balkans, pending approval for his removal to either the U.S. or his home nation, South Korea.

In addition to the financial penalties, Do Kwon’s legal troubles continue. He is awaiting extradition, pending approval for his removal to either the U.S. or South Korea. Kwon’s sentence for travel paper fraud expired in March, and he was released on home arrest from SpuΕΎ prison in Montenegro. Previously, Kwon was on the run after Terra’s $60 billion collapse, which sent shockwaves through the digital asset industry and led to several bankruptcies.

Extradition to America or South Korea has been approved multiple times but has been overturned in a continuous legal battle involving attorneys and Montenegro’s judicial system. As of now, Kwon’s extradition destination remains uncertain, but he could face substantial prison time for his role in Terra’s downfall.

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