New Update from SEC Regarding Refunds to Users Affected by Terra (LUNA) Collapse: Deadline Extended

The U.S. Securities and Exchange Commission (SEC) has extended the deadline for the settlement plan in the Tai Mo Shan Limited case, which concerns cryptocurrency breaches, for a second time.

The SEC announced in a press release that the deadline for submitting a “Proposed Distribution Plan” as part of the administrative proceedings against Tai Mo Shan Limited has been extended until August 20, 2026.

On December 20, 2024, the SEC initiated cease-and-desist proceedings against Tai Mo Shan Limited under Section 8A of the Securities Act of 1933.

According to the commission’s findings, the company conducted securities issuance and sale using interstate trading instruments without a registration statement in effect during the period of January 2021 – May 2022.

In this context, Tai Mo Shan was found to have violated Sections 5(a) and 5(c) of the Securities Act.

Tai Mo Shan Received a SEC Penalty Due to the Terra (LUNA) Collapse

The SEC also stated that the company engaged in misleading behavior toward investors in May 2021. This behavior involved misleading the public about TerraUSD (UST), an “algorithmic stablecoin” developed by Terraform Labs.

In this context, it was concluded that Tai Mo Shan violated Section 17(a)(3) of the Securities Act.

The SEC ruling has ordered Tai Mo Shan Limited to pay a total of $123,095,287. This amount consists of $73.45 million in disgorgement, $12.91 million in prejudice interest, and $36.72 million in administrative fines. The latest extension grants the SEC additional time to prepare a plan for how the compensation will be distributed to affected investors.

*This is not investment advice.