Terraform Labs opens a portal for Terrausd victims

Terraform Labs announced that the cryptocurrency loss claims portal will be open on March 31, 2025, allowing affected investors to seek compensation for losses related to the Terra USD (UST) token crash.

The company ended its operations after bankruptcy, saying creditors must file a claim by April 30, 2025 in order to be deemed as potential recovery.

Qualification criteria and post-application procedures

According to the blog post, creditors must register on the Kroll-managed portal and provide proof of ownership to submit their request. For holdings on the Terra ecosystem or supported network, users must sign the transaction through the transaction for free.

Those who own assets on other platforms are encouraged to submit read-only API keys. Manual evidence (such as transaction logs and account statements) is also acceptable, but this can lead to longer review periods.

The plan administrator will determine the value of the application based on the loss of qualified cryptocurrencies. However, not all assets are eligible. Cryptocurrencies with liquidity below $100 on chain, as well as cryptocurrencies with Luna 2.0 (such as Luna 2.0) on Terra 2.0 are excluded. Claims for submitting manual evidence may also be denied if a preferred verification method is available but not used.

After submission, accounts receivable will be reviewed by Wind Down Trust. Within 90 days of the April 30 deadline, creditors will receive a portal notice detailing their submission status. They may then accept or raise objections and distribute the approved amount shortly afterwards in probila.

UST crash and legal troubles

UST Terraform Labs’ Stablecoin collapsed in May 2022, with its algorithm nailing to the US dollar, causing an estimated $40 billion in losses across the cryptocurrency market.

The incident led to multiple lawsuits and investigations, and the company eventually filed for bankruptcy in January 2024. In September of that year, the court approved the Stablecoin issuer’s plan to put down its business in part of its bankruptcy lawsuit.

It also reached a settlement with the U.S. Securities and Exchange Commission (SEC), agreeing to pay $4.47 billion in contracts and fines. This is after an earlier ruling that the company and its co-founder Do Kwon have committed fraud.

To meet these obligations, Terraform Labs will use transferable assets, including Python tokens and other holdings. However, the settlement also requires payment to the SEC only after the company liquidation process resolves the creditor’s claim.