Following the SEC’s landmark ruling that classified Terraform Labs’ tokens as unregistered securities, a legal earthquake reverberated through the crypto world. On December 28th, 2023, the Southern District of New York delivered a significant decision. The court ruled that the now-defunct Terraform Labs tokens—UST, LUNA, wLUNA, and MIR—were indeed investment contracts under the Howey Test. This ruling solidified the SEC’s long-standing argument that Terraform’s token offerings were unregistered securities sales. The legal victory sent shockwaves throughout the crypto industry, particularly for decentralized ecosystems still relying on value creation promises, as it underscored the need for clear regulatory guidelines.