The focus of the case revolves around allegations that Galaxy Digital, led by founder Michael Novogratz, participated in the promotion and purchase of LUNA tokens at a discounted rate in 2020, sparking interest in the token in the Western market. New York Attorney General Letitia James stated that Galaxy Digital bought 18.5 million LUNA tokens from Terraform Labs for $0.22 each, below the market price at the time, contributing to the token's visibility and subsequent price surge. Despite publicly supporting LUNA and Novogratz's pledge to get a tattoo if the token hit $100, Galaxy Digital sold millions of tokens without disclosure, profiting as the price rose. The company had mostly sold its LUNA holdings by the time the Terra ecosystem collapsed in May 2022, while Terraform Labs founder Do Kwon faces multiple fraud charges after being arrested in Montenegro in 2023. The settlement of the $200 million lawsuit against Galaxy Digital highlights the increasing scrutiny on crypto firms involved in the rise and fall of digital assets, emphasizing the potential legal and financial consequences for major crypto investment firms. This resolution with the New York Attorney General could establish a precedent for future actions against firms connected to the failure of other cryptocurrency projects.
Galaxy Digital Settles $200 Million Lawsuit Over LUNA Token Allegations
2025-03-30 22:02:17 Primitive Reading
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