SEC Takes Action Against Terraform Labs and Do Kwon Over Alleged Fraud
Terraform Labs, the company behind failed stablecoin TerraUSD, and co-founder Do Kwon are being sued by the United States’ Securities and Exchange Commission (SEC) for allegedly deceiving investors. The SEC claims Terraform and Kwon provided misleading information about the algorithmic stablecoin’s stability and who was using it for payments. The SEC also describes Anchor Protocol and LUNA token as “crypto asset securities.” The case comes after the collapse of TerraUSD, which reportedly triggered several crypto industry bankruptcies. Terraform Labs has yet to respond to the lawsuit, and the SEC’s Enforcement Director dubbed the project “a fraud.”
Bank of Japan Announces Central Bank Digital Currency Pilot Program for April 2023
Japan’s Bank of Japan (BoJ) is set to launch a central bank digital currency (CBDC) pilot in April 2023, following its proof-of-concept testing that began in 2021. The pilot program aims to include private businesses to test a CBDC ecosystem. BoJ’s executive director Shinichi Uchida announced the CBDC pilot in a speech at a CBDC committee meeting, highlighting the need to consult with the private sector on alternative data models and architectures for offline payments, among other crucial elements of the system. Meanwhile, Japan is considering lifting the ban on foreign stablecoins, which was imposed in 2022, allowing those that pass individual checks into the market.
Binance CEO Predicts Global Crypto Industry to Shift Non-US Dollar Stablecoins
Binance CEO Changpeng Zhao (CZ) has suggested that the crypto industry will start to use stablecoins pegged to the Euro, Yen, or Singapore dollar, following recent actions against the U.S. dollar-pegged stablecoin BUSD. CZ made the statement during a Twitter Spaces event, where he noted that the U.S. government’s recent actions against U.S. dollar stablecoins will lead the global crypto industry to rely on other currencies to back stablecoins. CZ suggested that algorithmic stablecoins may play a more significant role in the crypto ecosystem in the future, but warned that they inherently carry risks that must be disclosed transparently to users.