Terraform Labs filed for Chapter 11 bankruptcy protection on Sunday, following the collapse of its cryptocurrencies TerraUSD and Luna in 2022.
Singapore-based Terraform said in a statement that it had taken the “strategic step” of filing with the Delaware Bankruptcy Court so that it could continue operating while the “legal challenges” were resolved.
The US Securities and Exchange Commission has charged Terraform co-founder Do Kwon with defrauding investors out of billions of dollars.
“We've overcome significant challenges before, and despite long odds, the ecosystem has survived and even grown in new ways… We look forward to the successful resolution of the pending legal proceedings,” Chris Amani, Terraform's CEO, said in a statement.
In May 2022, stablecoins TerraUSD and Luna collapsed, wiping out more than $40 billion in market cap and helping to start a broader crypto collapse.
In its report on Sunday, Terraform cited estimated assets between $100 million and $500 million, and the same range in liabilities.
Last week, a federal judge postponed Kwon's trial until April, to allow time for his extradition to the United States from Montenegro, where he fled after South Korea issued an arrest warrant for him in late 2022.
South Korea indicted Terraform's other co-founder, Daniel Shin, in April 2023.
