According to one mentor, the American Securities Sale Association (SEC) lawsuit against Terraform Labs and founder du Quan can be called SEC's "route map" of other Stablecoins.

Gabriel Shapiro, general counsel of Delphi Labs, an investment management firm, explained to his 33800 followers on Twitter that the factual arguments presented in SEC's condemnation of his rights and Terraform were "more complete than usual".

Shapiro's interpretation comes after the American Securities Trading Association filed a lawsuit against Kwon and Terraform on Feb. 16, accusing them of "orchestrating a multibillion-dollar encrypted asset securities fraud involving algorithmic stability and other encrypted asset securities."

Shapiro hinted that the case could provide a "route map" for regulators to sue other smooth issuers in the future. He agreed that SEC felt that Terra's algorithm stablecoin,TerraClassicU.S. (USTC), formerly known as TerraU.S. (UST), formed a security:

"[the SEC] will claim that the creation of a stable ecosystem by integration, marketing promotion, marketing promotion, business services transactions and so on is' other people's diligence 'and' reasonable expectation', which can bring benefits related to the stable."

He stressed that SEC made up lies in four aspects of the Howie test, and that according to the US Securities Law, HKUST, Terra Classic (LUNC)-formerly known as Terra (King Luna)-and its WLUNC (WLUNC) all formed securities.

SEC also made up lies. Terraform Labs launched the Mirror system Agreement, which violates US securities law, which allows clients to establish what Terraform refers to as "MASSET"-an encrypted version of asset data that "reflects" the price behavior of other assets such as individual stocks.

Regulators claimed that Terraform Labs submitted the swaps based on securities under the Mirror system Agreement (MIR) dynamic password-which Shapiro felt was the "first" of a digital currency-related lawsuit mentioned by SEC.

Shapiro stressed that the American Securities Trading Federation claimed that wLUNA formed the "receipt" of securities, which was another "first".

Ryan Sean Adams, the host of the podcast variety show Bankless, who faced the login password, gave similar views to his more than 221300 fans on Twitter, stressing that winning the Terraform Labs lawsuit would make it easier to verify other stable coin publishers.

The Terra-related dynamic password notoriously collapsed in May 2022, in part because HKUST abandoned its peg to the dollar. Because LUNC is closely related to iFLYTEK technology, its price has dropped by nearly 100%, and triggered a widespread slump in the login password market, which came to about $40 billion.

According to South Korean officials who issued arrest warrants to Prime Minister Kwon, he insisted that he was not "at large" and that he was said to live in Portugal.

In early February, two South Korean prosecutors flew to the Balkan countries to explore the prime minister of power; however, the search failed.

Cointelegraph contacted Terraform Labs and asked to post about the prosecution, but did not receive all responses before the release date.