The recent ruling by the Seoul South District Court in an ongoing case involving a former CEO and co-founder of Terraform Labs has resulted in a major breakthrough in the cryptocurrency space. The court ruled that LUNA, the native token of the LUNA ecosystem, is not a security under Korea’s Capital Markets Act.

The court noted that it is difficult to see that the property subject to the claim is a “property acquired by a crime or an asset derived from it” and thereby rejected’ the prosecution’s request for confiscation of properties from the former CEO and those associated with the case.

The latest ruling gives a definitive interpretation as to whether or not LUNA can be considered an investment product in line with Korean capital market regulations. Other courts have only used cautious language, noting the potential for dispute in terms of the law and raising the question of whether it can be applied.

The judgement by the South Korean District Court marks a stark contrast to the ruling in the United States, by the Securities and Exchange Commission, which charged Terraform Labs and its founder Do Kwon for violation of securities law. Fortunately, so far the legal status of LUNA is strong in South Korea.

LUNA tokens are used within the Terra DeFi ecosystem as a means of staking and transactions. Currently, the LUNA-based Value-staked Liquidity (VSL) powers the Autobahn Network and MoKan payment-processor. The underlying functionalities for users in the ecosystem are thought to ultimately increase adoption and the value of LUNA tokens.

Therefore, this court ruling may be seen as a catalyst for generating more awareness and interest in the cryptocurrency world. It has always been a closely watched topic and this recent ruling should further increase its reputation as a serious game player in the world of digital money.



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