Terraform Labs gets court approval to wind down its operations in the latest bankruptcy hearing, gaining investors’ attention. A US Bankruptcy judge has approved the firm’s plan, which came after its settlement with the US SEC. Notably, the news appears to have boosted the market sentiment, as evidenced by the rally the LUNA and LUNC prices today.
Terraform Labs Receives Court Nod To Wind Down Operations
A recent Reuters report highlighted the development, saying that the Terraform Labs has received legal approval to close its operations. In the latest bankruptcy hearing, Judge Brendan Shannon approved the firm’s plan to liquidate its assets, sparking investors’ optimism.
The approval follows a settlement of the firm with the US SEC. Notably, the agency has previously accused the company and its founder Do Kwon of defrauding investors after the TerraUSD and LUNA collapse in 2022. Notably, the collapse has resulted in around $40 billion losses for the traders.
Meanwhile, the Judge has dubbed the approval as a “welcome alternative” to the extended lawsuit. Precisely, the approval would allow the company to start liquidating its remaining assets, with an estimated payout between $184.5 million and $442.2 million to investors and other stakeholders.
However, the firm said that the exact amount of the eligible crypto losses remains unknown, saying that it is “impossible to estimate” the total losses that could be returned. Notably, Terraform Labs has agreed to settle the SEC lawsuit for $4.47 billion, though the agency is not expected to collect much from this settlement.
The regulator has agreed to receive the payment only after the crypto losses claims are compensated during the liquidation process. This move highlights the agency’s acknowledgment of the significant losses of investors.
LUNC and LUNA Prices Rally
During writing, Terra Luna Classic price was up over 8% and traded at $0.00008743, after touching a 24-hour high of $0.00008829. Its trading volume also jumped nearly 85% to $26.17 million. Simultaneously, LUNA price rose about 9% to $0.4033, while its trading volume soared 42% to $47.12 million.
The LUNA has touched a 24-hour high and low of $0.4092 and $0.3711. Furthermore, CoinGlass data showed that the LUNC and LUNA Futures Open Interests soared more than 28% and 27%, respectively, indicating growing market confidence.
Notably, a recent LUNC price analysis shows that the crypto could target $0.000135 if it breaks a crucial resistance ahead. This bullish forecast, amid Terraform Labs’ bankruptcy development, appears to have bolstered the market sentiment, evidenced by the recent surge in prices.
In addition, several positive developments in the Terra ecosystem have also boosted the market sentiment. For instance, Terra Luna Classic has successfully implemented the v3.1.5 upgrade which focuses on security and other key aspects of the ecosystem.
Rupam Roy
Rupam is a seasoned professional with three years of experience in the financial market, where he has developed a reputation as a meticulous research analyst and insightful journalist. He thrives on exploring the dynamic nuances of the financial landscape. Currently serving as a sub-editor at Coingape, Rupam’s expertise extends beyond conventional boundaries. His role involves breaking stories, analyzing AI-related developments, providing real-time updates on the crypto market, and presenting insightful economic news.
Rupam’s career is characterized by a deep passion for unraveling the complexities of finance and delivering impactful stories that resonate with a diverse audience.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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