Terraform Labs, a cryptocurrency company, has been approved for bankruptcy liquidation following a settlement with the U.S. Securities and Exchange Commission (SEC). The SEC accused the company of defrauding investors who lost around $40 billion when Terraform's tokens crashed in 2022. The bankruptcy plan has been approved by a U.S. Bankruptcy Judge, allowing the company to begin liquidating its assets. As part of the settlement, Terraform Labs has agreed to pay $4.47 billion to the SEC, but it's uncertain how much the regulator will recover. The company estimates it could pay between $184.5 million and $442.2 million to affected crypto buyers and stakeholders.



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