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April 5, 2024

Another SEC Victory In the Battle Against the Lawless Crypto Industry – Terraform and Do Kwon Liable in $40 Billion Fraud

WASHINGTON, D.C. — Dennis Kelleher, Co-founder, President, and CEO, issued the following statement in connection with crypto firm Terraform Labs and its creator Do Kwon being found liable for securities fraud:

“A week ago, Sam Bankman-Fried was sentenced to 25 years in prison, with the crypto industry claiming that the FTX founder was an outlier who was not representative of and really had nothing to do with the rest of the industry. Today’s jury verdict finding Terraform Labs and its founder Do Kwon liable for a massive $40 billion crypto fraud again exposes the truth:  Whether it’s FTX, Binance, Terraform, or any of the many other crypto cases involving predatory, fraudulent, and criminal activities, these cases are not coincidental or one-offs. Lawlessness and law-breaking are at the core of the crypto industry, which makes the baseless claim that the most basic securities laws apply to everyone else in the U.S. but not them. That is ludicrous.

“The verdict also confirms what we have been saying for a long time. Longstanding, clear securities laws apply to almost all crypto products and activities, and the SEC has the authority and duty to regulate, police, and hold them accountable. The SEC’s Enforcement Division should be commended for its work protecting investors, customers, markets, and financial stability from crypto’s crimes spree, not criticized, undermined, and attacked by crypto’s allies in Congress, the media, and a fellow regulatory agency.

“There’s a reason why crypto remains the financial product of choice for criminals worldwide, including for blackmailers using ransomware, money launderers, sex traffickers, terrorists, drug dealers, rogue states, tax evaders, and many others. Terraform, with its founder and CEO sitting in foreign prison trying to evade justice for his crimes, is just the latest entry on crypto’s epic rap sheet. It’s time that everyone recognizes and treat crypto as the worthless product that it is and force the industry to comply with the laws and rules that apply to every other financial firm and person in the country.”


Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit

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