Crypto company, Terraform Labs, the company that caused the collapse of two stablecoins, Luna and TerraUSD, to wipe approximately $40 billion from the cryptocurrency market filed for Chapter 11 bankruptcy protection on Sunday.
According to Bloomberg, the cryptocurrency company’s estimated liabilities and assets fall between $100 million and $500 million, and its estimated creditor count is between 100 and 199.
The firm was formed in Singapore, and Do Kwon, the co-founder and previous CEO, is listed as the primary stakeholder with 92 percent of the shares.
Kwon is still being held in jail pending his extradition to the US, where he will be charged with securities fraud after he and his colleague were arrested in Montenegro in March for traveling with false passports.
Due to identical allegations, the entrepreneur is also wanted in his native South Korea. As a result, it is said that he, his family, and a few important Terraform Labs employees fled to Singapore in April and May of 2022.
Kwon refuted claims that he was “on the run” just before Interpol added him to the “red notice” list in September of that year, but the ultimate recovery of his forged passports would seem to indicate otherwise.
Kwon is probably going to suffer the same fate as other well-known figures in the crypto industry, such as Alex Mashinsky, the former CEO of Celsius Network, and Sam Bankman-Fried of FTX.
