by Coinstrooper Crypto Articles
Quick Take
  • “This action is a necessary step to hold Jump Trading accountable for illegal conduct that directly caused the largest crypto collapse in history.”
  • Regulators have previously pointed to Jump’s trading in Luna, with the SEC saying in court filings that Jump made about $1B in profit by selling the token.
  • The post Terraform Liquidators Allege Jump Trading Helped Fuel Crypto’s Biggest Crash: Report appeared first on Cryptonews.

What Happened

Todd Snyder, the court-appointed plan administrator for the Terraform bankruptcy, filed a lawsuit in federal court in Illinois seeking $4B in damages from Jump Trading, co-founder William DiSomma, and former Jump Crypto president Kanav Kariya, the Wall Street Journal reported Thursday.

“Jump Trading actively exploited the Terraform Labs ecosystem through manipulation, concealment, and self-dealing that enriched Jump while financially devastating thousands of unsuspecting investors,” Snyder said in a statement.

Market Context

The administrators winding down what is left of Do Kwon’s Terraform Labs have turned on one of crypto’s biggest trading shops, alleging Jump Trading profited from Terra’s surge and helped lay the groundwork for its collapse.

“This action is a necessary step to hold Jump Trading accountable for illegal conduct that directly caused the largest crypto collapse in history.”

The wipeout erased about $40B in value and rippled across the industry, squeezing lenders, funds, and exchanges that had treated UST yields and Luna liquidity as deep and durable.

Regulators have previously pointed to Jump’s trading in Luna, with the SEC saying in court filings that Jump made about $1B in profit by selling the token.

The post Terraform Liquidators Allege Jump Trading Helped Fuel Crypto’s Biggest Crash: Report appeared first on Cryptonews.

Why It Matters

Terra’s Death Spiral And The Contagion That Followed

Claims Of Peg Support And Profits From Terra’s Fall

Details

Snyder’s complaint says Jump entered a secret arrangement to support TerraUSD’s peg before the final break and later walked away from the wreckage with outsized gains.