Terraform Labs Opens Claims Portal for UST Creditors Ahead of April 2025 Deadline

Highlights:

• Terraform Labs has launched a claims portal for UST creditors.
• Only specific assets qualify for compensation as crypto holdings under $100 are excluded.
• Terraform Labs filed for bankruptcy in 2024, and the court approved its $4.47 billion settlement with the SEC.

Terraform Labs has set up a crypto claims portal to assist users affected by the 2022 TerraUSD (UST) crash. Creditors will be able to submit claims on the platform between March 31, when it will open, and April 30, 2025. Users are required to submit claims timely, as claims submitted after the deadline will not be considered.

Terraform Labs Creditors: The Crypto Loss Claims Portal is scheduled to open for submission of Crypto Loss Claims on March 31, 2025. Creditors may file Eligible Crypto Loss Claims at https://t.co/7YQvfQr76x. The deadline to file is April 30, 2025 at 11:59 p.m. (prevailing Eastern…

— Terra 🌍 Powered by LUNA 🌕 (@terra_money) March 28, 2025

Creditors must also give proof of asset ownership in order to file a claim. This could comprise wallet addresses, read-only API keys, or any supporting documents. Moreover, the Wind Down Trust will be responsible for verifying the validity of each claim through the verification process.

Terraform Labs has asked creditors to read carefully the Crypto Loss Claim Procedures posted on the official claims portal. The reason for this is that the next step requires all submissions to have all the required standards. In addition, the trust will reject any submission that lacks the necessary information.

Terraform Labs is seeking to fix some of the problems from the crash of UST through the claims portal. The collapse of the stablecoin caused massive financial losses, which ultimately resulted in the company’s bankruptcy filing.

Eligibility Criteria and Compensation Process

Not every asset will be eligible for compensation. In particular, those with crypto holdings below $100 on the chain are excluded from the claim. Moreover, some tokens, such as Luna 2.0 on the Terra 2.0 blockchain, will not qualify. A full list of eligible assets will be available on March 31.

After submitting a claim, creditors will receive an initial determination within 90 days following the April 30 deadline. They will have the option to accept or dispute the calculated compensation. In case a creditor does not agree with the claim amount, the trust may extend the verification process, therefore delaying the disbursement.

In case no dispute is raised, payouts will start as soon as possible. The trust will share the compensation on a pro rata basis based on the total number of claims it approves. According to Terraform Labs, all claimants should submit accurate information, or else they run the risk of delays.

The trust requires creditors to file their claims online via the official portal. In addition, there will be no manual submissions. However, the trust may also accept evidence such as transaction logs or screenshots. The company has also warned that the manual submissions could delay the review process and increase the risk of a claim being denied.

Terraform Labs’s Legal and Financial Fallout

UST collapsed in 2022, and nearly two years after, Terraform Labs filed for Chapter 11 bankruptcy in January 2024. Prior to this, several legal challenges and regulatory scrutinies from the authorities preceded.

Terraform Labs was approved by a U.S. bankruptcy court to wind down operations in September 2024. The decision came shortly after a $4.47 billion settlement with the SEC. Terraform Labs and its founder, Do Kwon, had been accused of misleading investors about the stability of TerraUSD.

Investment firm Galaxy Digital has settled a separate case with the New York Attorney General for $200 million. The firm and its founder, Michael Novogratz, were accused of promoting LUNA and selling off huge portions of it without informing their investors. The company agreed to pay the fine over three years and to improve transparency by updating its internal policies.