Todd Snyder, who oversees Terraform Labs’ bankruptcy, has launched a lawsuit against Jump Trading and several of its executives.
The case seeks $4 billion in damages stemming from the 2022 collapse of the Terra ecosystem, according to a report by The Wall Street Journal.
The filing alleged that Jump Trading made illegal gains and played a role in Terra’s downfall. The suit names Jump’s co-founder, William DiSomma, and the former head of its digital asset division, Kanav Kariya, alongside the firm itself.
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Snyder argued that Jump took advantage of the Terraform platform through manipulation and self-dealing, and that the case aims to recover money for investors and creditors who suffered losses.
The complaint describes private deals between Terraform and Jump that enabled the trading firm to buy large quantities of LUNA tokens at far below market value. Jump was allegedly allowed to purchase millions of tokens for $0.40 each while the market price exceeded $110.
In return, the company was expected to help maintain TerraUSD’s link to the US dollar, actions that hid flaws in the system’s design.
The filing also stated that the arrangement was kept informal to avoid regulatory notice. When TerraUSD first lost its peg, Jump was accused of claiming that the system itself restored stability, rather than acknowledging its involvement.
Federal authorities in Michigan, working with international law enforcement, recently took down a cryptocurrency exchange called E-Note. How did the case unfold? Read the full story.
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