QUICK TAKE
- Chris Amani, CEO of Terraform Labs, announces the company’s dissolution.
- Amani calls on the community to assume control of the Terra network.
Chris Amani, CEO of Terraform Labs, the firm behind the Terra blockchain, has announced the company’s plan to dissolve its operations. In a significant move, Amani is urging the Terra community to take over the management of the network as the company winds down.
According to Amani, Terraform Labs intends to sell its projects within the Terra ecosystem, including Pulsar Finance, Station Wallet, and Enterprise DAO. This decision follows the firm’s massive $4.47 billion settlement with the U.S. Securities and Exchange Commission (SEC), related to the collapse of its UST algorithmic stablecoin in 2022.
“TFL always intended to dissolve at some point, and that point is now,” Amani stated on X, indicating the end of Terraform Labs. “We will be winding down operations completely.”
Amani outlined plans for a community proposal that involves burning all unvested Luna tokens, Terraform’s native cryptocurrency. “Anything that remains vested in our wallets will be burned by TFL,” he assured, marking a definitive end to the company’s direct involvement with the token.
Despite the dissolution, Amani emphasized that the Terra and Terra Classic blockchains could continue under the community’s control. “The community will need to take over ownership of the chain,” he said, proposing a community-led governance model that could reshape the future of blockchain projects in the aftermath of a crisis.
The SEC charged Terraform Labs and its co-founder, Do Kwon, in February 2023, accusing them of misleading investors and engaging in fraudulent activities related to the sale of unregistered securities. The proposed settlement includes $3.58 billion in disgorgement and a $420 million civil penalty. Additionally, it prohibits Kwon from serving as an officer or director of any public company. Kwon is also required to contribute about $204 million to a bankruptcy estate for Terraform, aimed at compensating harmed investors.
Amani, who stepped up as CEO after serving as the COO, took over from Kwon in July 2023. The company filed for Chapter 11 bankruptcy in a Delaware court in January.
This dramatic turn of events highlights the profound impact regulatory actions can have on blockchain firms and underscores the importance of community-led governance in the evolving crypto landscape. As Terraform Labs prepares to wind down, the future of the Terra network now lies in the hands of its dedicated community.
