TL; DR
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Terraform Labs (TFL) is the company responsible for creating the bear market-starting dumpster fire of a stablecoin known as ‘UST’.
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Terraform Labs is not in a good place, the company is being sued left right and centre. A Chapter 11 filing means TFL can continue operations while it goes through the “reorganization process.”
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Along with the announcement of the Chapter 11 filing, current TFL CEO Chris Amani said this: “This move protects our ability to continue working with the community on infrastructure, innovative tools and products, and other ecosystem support.”
Full story
Remember Terraform Labs (TFL)?
(The company responsible for creating the bear market-starting dumpster fire of a stablecoin known as ‘UST’?)
Yes, they just filed for Chapter 11 bankruptcy.
And if you’re like us, two pressing questions are now running through your old mind:
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Wait…TFL hadn’t filed for bankruptcy yet?
No. We were just as surprised as you. -
What does this mean for TFL and its associated crypto tokens?
This bankruptcy filing is actually a good thing…
The latter seems counterintuitive, right?
Here’s what we learned after Googling “benefits of Chapter 11 bankruptcy”:
Terraform Labs is not in a good place, the company is being sued left right and centre. A Chapter 11 filing means TFL can continue operations while it goes through the “reorganization process.”
(Also known as: the ‘we need to find/generate money to pay people off’ process).
A process that – and this is the really important part – is assisted by the court, where orders are issued to keep the company’s (many) creditors at bay.
Along with the announcement of the Chapter 11 filing, current TFL CEO Chris Amani said this:
“This move protects our ability to continue working with the community on infrastructure, innovative tools and products, and other ecosystem support,”
It’s eerily positive news coming from a seemingly negative news story, isn’t it?