Lawyers for Terraform Labs and its co-founder Do Kwon say a fine closer to $1 million is more appropriate after being found guilty of fraud and not the $5.3 billion proposed by the U.S. Securities and Exchange Commission.

Their ask comes a week after the SEC said Kwon and Terraform should pay about $4.7 billion in disgorgement and prejudgment interest and said Terraform and Kwon should pay $420 million and $100 million, respectively, in civil penalties.

That figure should be much lower, Kwon and Terraform's lawyers said in a court filing posted late last week.

"In conclusion, the Court should not grant any injunctive relief or disgorgement, and should impose at most a $1 million civil penalty against TFL," the lawyers said.

The SEC charged Terraform and Kwon in February 2023 over the …