The administrator overseeing Terraform Labs' liquidation has sued Jane Street, accusing the trading firm of engaging in insider trading that accelerated the collapse of Do Kwon's Terra-Luna empire.
Terraform Labs' liquidation administrator, Todd Snyder, filed a complaint on Monday against Jane Street, co-founder Robert Granieri, and employees Bryce Pratt and Michael Huang, according to the Wall Street Journal. Snyder alleges that Jane Street used non-public information it obtained from Terraform Labs insiders to front-run trading.
"Jane Street abused market relationships to rig the market in its favor during one of the most consequential events in crypto history," Snyder said, according to the WSJ report. The administrator added that his team will "pursue all avenues" against those who exploited their positions for "substantial profits" at the expense of Terraform Labs creditors.
Meanwhile, Jane Street reportedly disputed Snyder's claim by saying that Terra-Luna's collapse was a result of a "multibillion-dollar fraud" perpetrated by Terraform's management, adding that it will defend against the "opportunistic claims" vigorously.
The Block has reached out to Snyder and Jane Street for further comment.
Jump Trading
Last December, Snyder sued Jump Trading and its top executives, claiming that Jump "actively exploited" the Terraform Labs ecosystem by entering into a backdoor deal to inflate the value of algorithmic stablecoin TerraUSD before it imploded. The administrator sought $4 billion in damages from the defendants.
Jump reportedly appears in the latest complaint against Jane Street, as Snyder claims that some of the non-public information was leaked to Jane Street through Jump Trading.
On May 9, amid the TerraUSD depeg, Pratt initiated a group message with Kwon and Jane Street representatives to express interest in bidding on Luna or bitcoin. Kwon replied that Jump co-founder Bill DiSomma should have already contacted them regarding a Terraform fundraise, the complaint alleges.
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