Terraform Labs Liquidator Blames Jump Trading for Terra-Luna Collapse

The bankruptcy administrator for Terraform Labs has filed a $4B lawsuit against Jump Trading, alleging it played a direct role in the collapse of the Terra-Luna crypto ecosystem.

What's the Scoop?

• New Accusation: The complaint, filed in Illinois, seeks $4B in damages from Jump, its co‑founder William DiSomma, and former Jump Crypto president Kanav Kariya. It alleges that Jump profited billions of dollars from a secret deal with Terraform Labs to defend the algorithmic stablecoin's peg before its ultimate failure, which wiped out $40B in value and kicked off a prolonged crypto winter.
• SEC Corroborates: Late last year, the SEC fined a Jump Crypto subsidiary $123M for deceiving the investing public into believing UST was stable. The SEC found that Jump purchased $20M of UST to stabilize price in exchange for a verbal agreement with Terraform Labs that allowed Jump to fully vest locked LUNA tokens.
• Recent Sentencing: Terraform Labs front man Do Kwon was recently sentenced to 15 years imprisonment. The Court called the Terra-Luna fraud as "eye popping" and "unusually serious," supported by blatant lies that wreaked unprecedented financial havoc in their wake.