Jump Trading, which focuses on algorithmic and high-frequency trading strategies, has been sued for profits of $1.3 billion from TerraUSD. Jump Trading and its CEO, Kanav Kariya, are accused of violating US law and making unfair profits.
According to a lawsuit filed in the Illinois district court in the US, Jump Trading, along with Terra Labs, was accused of manipulating the price of the algorithmic stablecoin TerraUSD (UST). Allegedly, the company purchased millions of USTs in 2021 with the aim of manipulating its value to reach $1. The lawsuit stated that Jump Trading and its CEO violated both SEC and CFTC laws. It was among the allegations that the company got rich for no reason.
Jump Trading was among the first partners of Terraform Labs. The company was one of Terra’s financial backers. The company was providing market making services for LUNA, USD and AUST transactions between November 2019 and September 2020. Within the framework of the agreements made with Terra and its subsidiaries, it was noted that the market maker company purchased LUNA tokens at a discount and sold them to the market at a higher price.
It was reported that the company purchased more than 62 million UST tokens on May 23-27. With this purchase, collusion was made to fix the market value of UST to $1. Jump allegedly made over $1.28 billion in profits from transactions. US prosecutors reportedly examined conversations in the Telegram group, which included Jump Trading, Alameda Research and Jane Street Group. It was stated that the companies discussed the potential recovery of TerraUSD on Telegram.
The value of LUNA and TerraUSD dropped to zero on May 11 last year. With the LUNA crisis, $40 million was wiped out of the market. Terraform founder Do Kwon was arrested in Montenegro in March. Kwon was released on bail of 400,000 euros yesterday. Kwon, who was tried without Turuk, is currently under house arrest.
This news is Chip Online and BTCHaber prepared in collaboration.