Terraform Labs CEO Do Kwon is suing the U.S. Securities and Exchange Commission (SEC).
The builder of decentralized finance (DeFi) platform Terra confirmed he was served with an SEC subpoena at Messari’s Mainnet convention final month, in accordance to a lawsuit filed Friday.
The matter stretches again to May 2021, when SEC’s Enforcement Division emailed Kwon, in accordance to the submitting.
At situation is Terra’s Mirror Protocol, a decentralized finance (DeFi) platform on which artificial shares mirroring the value of main U.S. corporations are minted and traded.
The subpoena requests that Kwon present testimony to U.S. regulators. As a resident of South Korea, Kwon is contesting that.
Terraform’s swimsuit in opposition to the SEC is uncommon however, in accordance to Anderson Kill lawyer Stephen Palley, preemptive authorized motion may make sense on this case.
“It’s a reminder to regulators that there are rules of engagement that they need to abide by as well,” Palley advised CoinDesk.
The SEC advised Terraform’s legal professionals that the U.S. regulator may sue the corporate.
“In a conversation on September 15, 2021, the SEC attorneys advised that they believe that some sort of enforcement action was warranted against TFL [Terraform Labs] and any cooperation, and implementation of remedial actions as to the Mirror Protocol, would result in a reduced financial sanction as part of any consent agreement,” the swimsuit stated.
Five days later, Kwon was served.
“The subpoenas were served on Mr. Kwon in public: Mr. Kwon was approached by the process server as he exited an escalator at the Mainnet summit while on his way to make a scheduled presentation that was not about the Mirror Protocol,” the swimsuit stated.
It seems to affirm a tweet by Indiegogo founder Slava Rubin who claimed to witness the occasion:
lol I simply witnessed a man get served by the SEC on the high of the escalator at #mainnet2021 proper earlier than happening stage for his panel
— Slava Rubin (@gogoSlava) September 20, 2021
Kwon advised The Defiant’s Brady Dale later that day that he had not been served.
Telegram messages despatched to Kwon weren’t returned.
Nikhilesh De and Cheyenne Ligon contributed reporting.