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wLUNA Could Also Be Classified As a Security: The SEC's Argument
by SEC vs. the WorldOctober 7th, 2023
Too Long; Didn't Read
Here's why the SEC believes wLUNA is also a security.
SEC v. Terraform Court Filing, retrieved on February 16, 2023, is part of HackerNoon’s Legal PDF Series. You can jump to any part in this filing here. This is part 17 of 38.
B. “Wrapped“ LUNA
4. wLuna is a Receipt for a Security
68. The definition of security under Securities Act 2(a)(1) and Exchange Act Section 3(a)(10) includes a "receipt for" a security. As described above, when an investor "bridges" LUNA to obtain wLUNA, the owner of the wLUNA has the right and ability at any time to exchange the wLUNA for LUNA, which was offered and sold as a security.
This mechanism created a pool of LUNA on the Terraform blockchain through which wLUNA owners could convert their holdings back into LUNA.
As a result, wLUNA is also a security because it is a receipt for a security.
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This court case 1:23-cv-01346 retrieved on September 12, 2023, from sec.gov is part of the public domain. The court-created documents are works of the federal government, and under copyright law, are automatically placed in the public domain and may be shared without legal restriction.
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