While the firm's team offered merely $1 million, the SEC proposed that Do Kwon and Terraform pay almost $5.3 billion in disgorgement, prejudgment interest, and civil penalties.

In a lawsuit involving the United States Securities and Exchange Commission (SEC), a jury found Terraform Labs and co-founder Do Kwon guilty of fraud.

A federal judge then ordered the parties to explore potential remedies, which could total millions or billions of dollars.

Judge Jed Rakoff stated in a filing on April 29 in the U.S. District Court for the Southern District of New York that attorneys for the SEC, Kwon, and Terraform should appear in court on May 22 to make arguments for suggested remedies following the jury's decision.

Each party has already filed documents in response to their individual petitions for disgorgement and civil penalties, but Judge Rakoff’s order allowed supplements before the court appearance.

The SEC requested Kwon and Terraform pay roughly $4.7 billion in disgorgement and prejudgment interest and a combined $520 million in civil penalties.

Terraform’s legal team suggested a $1 million civil penalty and no “injunctive relief or disgorgement.” Both parties will have until May 6 and May 1, respectively, to file supplements to their existing proposals.

On April 5, a jury found Terraform and Kwon liable for defrauding investors after a two-week trial with the SEC. Kwon could not attend the trial in person due to his 2023 arrest in Montenegro for using falsified travel documents.

The Terraform co-founder remains in the country as its courts weigh extradition requests from the U.S. and South Korea, and at the time of publication, it was unclear if he will be able to go to the U.S. court on May 22.

Ever since Terraform filed for Chapter 11 protection in January, the company has been subject to bankruptcy procedures. At the time, the projected liabilities and assets of the company were reported to be between $100 and $500 million.