Court Orders Terraform Labs to Pay Investors
Singapore's commercial court awarded about US$1.3 million to 31 TerraUSD investors in a ruling against Terraform Labs, Do Kwon and Luna Foundation Guard.
Updated on Nov. 6, 2026 in Financial Crime
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The Singapore International Commercial Court ordered Terraform Labs, Do Kwon and Luna Foundation Guard to pay about US$1.3 million to 31 TerraUSD investors. The defendants had conceded that their statements about UST's stability, peg and Anchor product were false and fraudulent.
Why it matters
The ruling holds the defendants liable to investors who relied on false statements about the TerraUSD stablecoin before its collapse. It sets out how damages are calculated for losses incurred before the cut-off date.
The court awarded damages to 31 investors across the second and third rounds, with interest of 5.33 per cent a year running until payment. The award for claimant David Francis Egan and third-round costs remain undecided.
The players
Terraform Labs
The blockchain company behind the TerraUSD stablecoin and Anchor product, whose collapse in 2022 wiped out billions in investor value.
Do Kwon
The Terraform Labs co-founder who was sentenced in the United States to 15 years in prison for defrauding investors.
The details
Damages were limited to losses incurred up to 12:01 am UTC on May 12, 2022, valued at a cut-off price of US$0.60485 per UST token. The court found all 28 claimants relied on at least one false statement, including that UST would always hold its US$1 peg, but refused aggravated damages for emotional distress for lack of medical evidence.
Timeline
May 12, 2022: UST failed to hold its peg for four days, setting the damages cut-off.
June 2026: The second round produced awards over US$3 million to 40 investors.
November 4, 2026: The Singapore court issued the third-round damages ruling.
Within 14 days of the ruling: Parties must agree on or submit competing figures for David Egan's award.
Legal Context
The ruling is one of several legal actions arising from the May 2022 collapse of TerraUSD, which the court treated as a failure of the stablecoin's promised US$1 peg. It shows how courts in Singapore are assessing reliance and damages in crypto-related investor claims.
Investors who lost money in TerraUSD may be able to recover losses through court awards if they fall within the cut-off terms. Those who continued holding in hopes of recovery were not treated as relying on the false statements, which affects who can claim compensation.
The takeaway
Investors should note that claims depend on proving reliance on specific false statements and on losses incurred before the defined cut-off date. Those holding on in hope of recovery may not qualify for compensation.
What happens next
The parties must agree on a figure for David Francis Egan's award or submit competing figures within 14 days of the ruling, and third-round costs will be decided later.
Further reading
For more on how fraud cases like this one are prosecuted and resolved, see Financial Crime.
Source note: This article includes information reported by The Business Times.
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