UST and LUNA battle in court: let the jury decide
Terraform Labs, the company behind UST and LUNA, asked the jury to decide in court whether the tokens are investment contracts. The U.S. Securities and Exchange Commission (SEC), which is suing Terraform Labs, wants the judge to decide, not the jury.
As it is known, the SEC had filed a lawsuit against Terraform Labs and its co-founder Do Kwon in February. The institution had accused the parties it sued of collecting billions of dollars from investors through the sale of unregistered investment contracts. A similar accusation was made against Ripple in December 2020, and the court found the SEC unfair in the case that has been going on for about 3 years.
Terraform Labs lawyer David Kornblau argued in his petition to the court that the jury should be the authority to decide whether the UST, LUNA, wLUNA and MIR tokens are investment contracts.
The acceptance of a token as an investment contract brings with it certain sanctions or fines for the sued persons or companies. Whether any asset is in the nature of an investment contract is also determined by subjecting it to a test called the Howey test. If the relevant asset meets the terms of the investment agreement, the company issuing that asset must obtain registration from the SEC.
Terraform Labs predicts that if this issue is referred to the jury, the jury will make a decision that UST and LUNA do not have an investment contract. in the case between Denis Audet and Stuart Fraser in 2021, the jury ruled that the cryptocurrencies Decried in the case were not investment contracts. The company cites the decision taken in this case as a precedent.
LUNA has gained over 100 percent in value amid the developments in the court process. Cryptocurrency has increased by 124 percent in the last month due to the influence of the general bullish mood in the market. The original version of LUNA, LUNC, has increased by 230 percent during the same time period.
