Do Kwon Strikes Back: Sues SEC Over Improper Sopenia

Not too long ago, the SEC served a subpoena on Terraform Labs CEO Do Kwon as he was about to make a scheduled appearance at Messari&39s Mainnet conference. The Securities and Exchange Commission approached Do Kwon back in May to inquire about the functioning of Mirror Protocol as well as Terraform Labs&39 relationship with the firm. The CEO willingly sat with the SEC lawyers and answered a wide variety of queries during a five-hour questioning period.

However, the CEO is now suing the SEC, claiming that the regulatory body has little to no jurisdiction regarding the plaintiffs. The final straw had in fact occurred in September, when the SEC subpoenaed Do Kwon, issuing some documents and paperwork during Messari&39s Mainnet launch event while the CEO was still speaking with Terraform&39s delegates.

Do Kwon Strikes Back

The founder of Terraform Labs is now officially suing the regulatory agency for violating its jurisdiction with the subpoenas. The CEO&39s complaint disputes the subpoenas, claiming that these were unlawfully given, as well as the agency&39s inability to maintain the confidentiality of a private investigation into the so-called Mirror Protocol.

Do Kwon is a South Korean resident, and although the SEC&39s guidelines specify that investigations are to be kept private, the regulator nevertheless issued a subpoena on an event that had nearly 2,000 people in attendance via the &lsquoCavalier Courier and Process Service&rsquo. Employing a &lsquoCavalier&rsquo procedure to confront the CEO in public at a highly anticipated event which was being attended by so many individuals was at best a reckless move, causing social media outrage along with press speculation regarding the encounter in only a few minutes of the orchestrated incident and at worst a clear attack on the cryptocurrency sector by the regulator.

The CEO, who has since gone on the offensive on behalf of the cryptocurrency industry&39s newest battle with the SEC, has identified a clear lack of comprehensive understanding within and between regulators as a major issue that continues to hinder the progress of decentralized finance (DeFi). The lawsuit additionally highlighted both the exponential growth of the industry and the subsequent resistance against it by various governmental and regulatory institutions such as the SEC.

The Battle Is OnEver since the incident, countless members of the cryptocurrency community have banded together to openly defy the SEC and its alleged authority over the industry. This is not the first time that the regulator had overstepped its boundaries and if left unchecked, it won&rsquot be the last either.

Furthermore, the complaint contends that the SEC violated its own guidelines governing the management and appropriate conduct of these types of situations. The subpoenas had been delivered in public, and one of Messari&39s Mainnet&39s assistants saw the delivery first-hand. This is contrary to SEC policy, which specifies that official matters must be kept secret until declared otherwise.

This lawsuit, therefore, requests that the subpoenas be declared null and void, as well as all damages including legal costs and other remedies, be covered as the court considers appropriate.