Terraform Labs to Reimburse Crypto Losses After Terra Collapse

Scheduled to open on March 31, the portal is aimed at compensating individuals who experienced losses of at least $100. This initiative follows a court decision in Delaware approving Terraform Labs' plan to cease operations, seen as a positive move to avoid further legal disputes related to investor losses. In addition, Terraform Labs settled with the SEC for $4.47 billion in June 2024. To file a claim, documentation must be submitted through the portal by April 30 at 11:59 PM ET, with claims below $100 not being considered. Claimants have the choice to provide either manual evidence, such as transaction logs and screenshots, or preferred evidence, like read-only API keys, which is deemed more accurate. The company warned that using manual evidence may result in longer review times and potential rejection if preferred evidence is available. Terraform Labs estimates it could pay eligible claimants between $184.5 million and $442.2 million, although the final amount is uncertain. Prior to its collapse, the company managed a $45 billion ecosystem, including its algorithmic stablecoin and LUNA token. The downfall of Terraform Labs had a significant impact on the cryptocurrency space, causing Bitcoin's value to drop by 37% in just one month. Following the collapse, Do Kwon, the founder of Terraform Labs, was arrested in Montenegro and extradited to the United States to face multiple criminal charges. His court hearing is set for April 10, with prosecutors currently examining new evidence.