The collapse of the Terra ecosystem continues to haunt the crypto world, with a new chapter unfolding around the now-defunct lending platform MyConstant.
Its founder, Duy Huynh, has agreed to a $10.5 million settlement with the U.S. Securities and Exchange Commission after allegedly misusing customer funds to bet big on TerraUSD (UST) before its dramatic downfall.
Huynh, operating under both his Vietnamese and American identities, pitched MyConstant as a low-risk crypto lending service with stable returns of up to 10%. But instead of following through with that promise, he diverted $11.9 million of investor capital into UST, a stablecoin that famously collapsed in 2022, dragging down much of the crypto market with it.
What was advertised as a safe investment turned into a disaster: nearly $8 million was lost on the UST purchases, and the SEC also claims Huynh misused over $400,000 for personal expenses. As the damage unfolded, he reportedly sent investors misleading updates to conceal the firm’s financial position.
Rather than contest the charges, Huynh settled, agreeing to return $8.3 million, pay $1.5 million in interest, and a $750,000 civil penalty—without admitting guilt. MyConstant officially shut down in November 2022 and placed its remaining assets into a trust for creditors. Only a fraction of the funds has been recovered to date.
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Source: https://coindoo.com/crypto-lending-boss-hit-with-millions-in-penalties-over-terra-collapse/