From Fortune:

1. A federal judge ruled that four crypto tokens offered by Terraform Labs constituted unregistered securities, a blow to the crypto industry amid debates over how to classify digital assets. The decision was a setback to the sector’s interpretation of securities law, a departure from a recent XRP ruling, and involved a $1-pegged stablecoin and its meltdown.

2. Terraform Labs cofounder Do Kwon faced an extradition fight with the U.S. after the stablecoin UST lost its $1 peg, causing a global dent in the crypto industry, and after allegations of a multibillion-dollar securities fraud by the U.S. SEC involving unregistered securities UST and LUNA.

3. Terraform’s lawyers argued that the tokens didn’t represent the traditional definition of securities under the Howey test because they didn’t involve investment in a common enterprise and were meant to maintain a $1 peg. Despite a separate XRP ruling, the judge dismissed the motion to dismiss the case involving Terraform and UST.

4. The judge’s decision furthered the argument that Terraform’s crypto assets were unregistered securities, even with the $1-pegged UST, as holders could earn a yield by depositing tokens in a company protocol. The case’s fraud claims related to UST’s depeg were left unsettled in the case and are set to be tried by a jury in January 2024.



Read more: Judge rules Terra ‘stablecoin’ and other tokens are securities in victory for the SEC and departure from Ripple case