Terraform Labs Opens Crypto Loss Claims Portal for UST Crash Victims

Terraform Labs, the company behind the failed TerraUSD (UST) stablecoin, has announced that it will open its Crypto Loss Claims Portal on March 31, 2025. This move comes as part of the company's ongoing efforts to address the financial fallout from the dramatic crash of the UST stablecoin in 2022, which led to the collapse of its $400 billion ecosystem. The portal is designed to facilitate the process for creditors affected by the crash, allowing them to submit their claims for compensation.

Eligible creditors must complete their registration on the portal by April 30, 2025. Any claims submitted after this deadline will not be accepted. To file a claim, users must provide proof of asset ownership, including wallet addresses, read-only API keys, and other supporting documents. The Wind Down Trust, which is overseeing Terraform Labs' bankruptcy process, will assess these claims. However, not all assets will qualify for compensation. Crypto holdings with on-chain liquidity under $100 and specific tokens like Luna 2.0 on the Terra 2.0 blockchain are excluded from the compensation process.

Creditors can expect an initial determination of their claim amount within 90 days after the submission deadline. They will have the option to accept or dispute the result. If a claim is not contested, disbursements will begin as soon as practicable, with all payouts being distributed pro rata. Terraform Labs has urged creditors to review the official Crypto Loss Claim Procedures on the claims portal to ensure their submissions meet the required standards.

Terraform Labs filed for Chapter 11 bankruptcy in January 2024, following the fallout from the UST crash. In September 2024, a US court approved the filing following a $4.47 billion settlement with the Securities and Exchange Commission (SEC). This settlement is a significant step in the bankruptcy process and aims to provide some form of compensation to the affected creditors. The opening of the Crypto Loss Claims Portal is a crucial development for those who were impacted by the collapse of the UST stablecoin. It provides a structured process for creditors to seek compensation and highlights the ongoing efforts to address the financial repercussions of the 2022 crash. The strict deadlines and requirements for proof of ownership ensure that the claims process is transparent and fair, aiming to distribute the available funds equitably among eligible creditors.