Terraform Labs Opens Portal for Investors to File Loss Claims in Bankruptcy Proceedings

Terraform Labs, the embattled company behind the collapsed TerraUSD (UST) stablecoin and LUNA token, is set to open its claims portal for creditors. The portal will be available starting March 31 as part of the company’s Chapter 11 bankruptcy filing last year. For context, this move comes after the collapse of its $40 billion ecosystem in 2022. The development left many investors and creditors facing significant financial losses. Registering Claims as Portal Opens Terraform Labs has announced that eligible creditors must register their claims through the "Crypto Loss Claims Portal" on April 30 at the latest for their claims to be considered. Notably, the firm will not entertain any claims after the deadline. The portal is part of Terraform’s bankruptcy reorganization efforts and provides a formal process for creditors to seek compensation for their losses. The company is expecting a significant number of claims as it works to manage its massive financial fallout. Required Documentation for Claims Submission To file a claim, creditors must provide evidence of their crypto holdings, including wallet addresses for assets held natively and read-only API keys for assets stored on centralized exchanges.  For those unable to provide these standard forms of proof, Terraform Labs will also accept account statements and transaction logs as “manual evidence.” However, claims supported by manual evidence may face longer review periods, as these will be subject to a more detailed, individualized review process. Terraform has advised all claimants that manual evidence claims will not receive an expedited determination. Notably, the company has stressed the importance of providing accurate and complete documentation to avoid delays. Reorganization Plan and Creditors’ Repayments As part of its reorganization plan, Terraform Labs intends to repay creditors up to $442 million. U.S. Bankruptcy Judge Brendan Shannon approved this plan in a previous ruling. Notably, Terraform’s proposed repayment plan comes after the company’s historic $4.47 billion settlement with the U.S. SEC, which accused the firm of defrauding users and creditors. However, the regular investor may not receive any portion of the settlement funds. Terraform Labs has agreed to prioritize repayments to creditors over the SEC settlement, ensuring that affected investors are compensated first.