Terraform Labs May Stop Products, Services Amid Bankruptcy
On September 25, Terraform Labs warned X that it would terminate several products and services on October 30 if no third parties took over.
The selloff is a component of Terraform’s wind-down process, initiated following its settlement with the United States Securities and Exchange Commission (SEC) in June.
Terraform “continues to progress with discussions with third parties,” it stated. It appears that the discussions are not proceeding seamlessly, and the tweet serves as a reminder to the Terraform community and potential purchasers of Terraform products that their time to act is restricted.
Terraform Labs Places Puts Services Up
Terraform has identified four services and four products that are currently being discussed. The services include the Luna Foundation Guard, which Do Kwon continues to serve as director, the blockchain explorer, and its application programming interface (API) services.
The proposed takeovers have been in the works for some time. After the company achieved a settlement with the SEC, Terraform CEO Chris Amani disclosed its intentions on June 12:
“I’m incredibly proud that we were able to hold this company and ecosystem together and continue to build innovative products through all of this. We were well positioned to accelerate things if we had won the trial, but unfortunately, we lost and as a result, can no longer operate.”
Dear Terra Community, Terraform Labs continues with progress with 3rd party discussions to take over operations of some of our products and services. However, in the case that they are not successful, we will be shutting down those products on October 30, 2024.
Buyers may emerge as the community becomes increasingly active
The Terraform community would be required to assume some responsibility for complying with the bankruptcy terms. “The community will be required to assume ownership of the chain.”
Amani stated in June, “I believe that there are a few teams and developers who are interested in pursuing this, and you should be able to find information in the forums shortly.” Logically, the community would assume responsibility for the network’s fundamental services.
The Terraform insolvency plan shut down Pisco testnet APIs in early September. Pulsar Finance may have already been acquired, as it is not included in the list of products for sale, even though its sale was noted in June.
Dear community,
As some of you know, with TFL losing the trial, @pulsarfinance is now for sale.
I'm reaching out to ask for your help in sharing this message.. We're in a tricky spot and we need to find a new home for the team.
— Miguel | Pulsar Finance 🇵🇹 (@defimiguel) June 13, 2024
In January, Terraform Labs submitted a bankruptcy petition in the United States. In June, it reached a settlement with the Securities and Exchange Commission (SEC) by committing to pay $4.47 billion, which includes disgorgement, penalties, and interest. A Delaware bankruptcy judge authorized the Terraform bankruptcy plan on September 20.
