Terraform Labs Nears SEC Fraud Settlement; Matter Labs' Trademark Attempt Sparks Outrage; U.S. Spot Ether ETFs' Launch Expected
Summary:
Terraform Labs and its co-founder Do Kwon are getting ready to settle a fraud lawsuit with the U.S. Securities and Exchange Commission, while the cryptocurrency arena protests against Matter Labs's attempts to trademark the term “zero-knowledge.” Furthermore, experts are signaling a potential launch of U.S. spot Ether ETFs from BlackRock, likely taking place by late June or early July.
Terraform Labs and its co-founder, Do Kwon, are set to reach an agreement on a fraud case with the United States Securities and Exchange Commission (SEC). In a parallel development, the cryptocurrency industry is reacting vehemently against Matter Labs' attempt to claim the term “zero-knowledge” as a trademark. Analysts are suggesting a potential launch of U.S. spot Ether exchange-traded funds (ETFs) by the end of June or in early July as documentation is being processed.
Terraform Labs and its co-founder Do Kwon are in the process of settling a fraud lawsuit with the SEC, an action which started months ago when they were found guilty of scamming investors. Court filings reveal that a proposed settlement will be put forward for the court's approval by the 12th of June, 2024.
In the lawsuit, the SEC claimed Terraform and Kwon misguided investors during the advertising and trading of cryptocurrency tokens, primarily the failed algorithmic stablecoin known as TerraUSD. Accusations were lodged against them for trading crypto assets without the right registration. Kwon and Terraform could face hefty financial penalties, seeking approximately $5.3 billion in damages by the SEC, while Terraform is arguing for a lesser penalty of $1 million. Kwon, apprehended in Montenegro in March 2023, could face additional charges.
Matter Labs has irritated the cryptocurrency sector by filing for trademark rights over the term “zero-knowledge” across nine countries, aspiring to reserve it exclusively as their intellectual property. Matter Labs, the company behind the development of zkSync, has made previous efforts to register a token using the ticker “ZK” on cryptocurrency exchanges to strengthen their claim over the technology.
Zero-knowledge (ZK) technology denotes cryptographic procedures allowing one party to prove a claim's truthfulness to another without revealing any related claim data. StarkWare's CEO, Eli Ben-Sasson, declared Matter Labs' attempt to trademark ZK technology as an "ridiculous intellectual property grasp".
Prominent industry professionals have urged Matter Labs to retract its trademark filing in a public letter, criticizing it as “overbearing conduct.” This official letter was endorsed by well-known individuals including the co-founders of Polygon, Sandeep Nailwal and Brendan Farmer, StarkWare CEO Eli Ben-Sasson, Tiancheng Xie, the co-founder of Polyhedra Network and the inventor of zkBridge, along with the Turing award winner and co-innovator of ZK-proofs, Shafi Goldwasser.
According to analysts, spot Ether ETFs in the U.S. could potentially launch by the end of June, given recent related filings by BlackRock with the SEC. Eric Balchunas, ETF Analyst for Bloomberg, notes a second round to "fine-tune" SEC remarks is expected, but the end of June launch is a "genuine possibility", despite an earlier approval seeming like a "long shot.
Published At
5/30/2024 8:53:04 PM
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