Do Kwon co-founded Terraform Labs in 2018 with Daniel Shin and released the cryptocurrency Luna later that year|Cryptologos|CC BY-SA 4.0

The Securities and Exchange Commission (SEC) is suing Terraform Labs and its founder, Do Kwon, for securities fraud.

The SEC alleges that Terraform Labs and Kwon “perpetuated a fraudulent scheme that led to the loss of at least $40 billion of market value.” Terraform and Kwon are further accused by the SEC of misleading investors about the stability of TerraUSD.

Kwon is also under scrutiny in South Korea, his native country, and is facing criminal charges, but he is nowhere to be found.

Kwon co-founded Terraform Labs in 2018 with Daniel Shin and released the cryptocurrency Luna later that year. Its algorithmic stablecoin, TerraUSD, was launched in 2020.