Terraform Labs has reached a settlement in its lawsuit with the Securities and Exchange Commission (SEC), with the defunct crypto firm agreeing to pay a $4.47 billion fine for its fraudulent activity related to the defunct Terra blockchain.

In a Wednesday letter to US District Judge Jed Rakoff, the SEC asked for approval of its “proposed final consent judgement” concerning Terraform and its famous co-founder, Do Kwon. The agency claimed that the seismic penalty addresses the “magnitude of this fraud” while allowing for “meaningful and speedy recovery” of the billions of dollars lost by the network’s investors. To settle this action, Terraform agrees to provide the SEC with all the relief it sought from the Court,” the letter stated. That includes $3.6 billion in disgorgement, $466 million in prejudgment interest, and a $420 million civil penalty – nearly matching what the SEC had requested in April. Kwon himself has agreed to pay nearly all penalties the SEC requested, including $204 million in monetary relief that will go entirely to the Terraform Labs bankruptcy estate to aid harmed investors. The SEC charged Terraform and Kwon with securities fraud in 2023 related to the fallen Terra blockchain, whose unstable design resulted in a spectacular $44 billion blowup across its LUNA and UST tokens. In early April, a jury found Terraform and Kwon guilty of misleading investors and of deliberate fraud. “The entry of this judgment would ensure the maximal return of funds to harmed investors and put Terraform out of business for good,” the SEC concluded.

If accepted, this would mark the largest settlement in a crypto fraud case to date, outsizing even Binance’s $4.3 billion settlement with the Justice Department in November. Still, some are skeptical that Terraform or Kwon actually have the money to pay the charges. “$4.47B cash-out is impossible, even with a $40B market ca,” wrote CryptoQuant CEO Ki Young Ju on the matter. “Do and Terraform arent supposed to hold that much money.”