Jump Crypto Has Confidentially Filed Documents in the SEC Case Against Terraform Labs
The trading company and its CEO Kanav Kariya allegedly manipulated the price of TerraUSD to make a profit of around $1.3 billion.
A federal judge has accepted materials from Jump Crypto Holdings as evidence in the U.S. Securities and Exchange Commission’s case against Terraform Labs.
In a lawsuit filed November 28 in the U.S. District Court for the Southern District of New York, Judge Jed Rakoff approved the confidential treatment of certain materials created by Jump Crypto Holdings, the crypto arm of Jump Trading. The company was reportedly under investigation by the SEC for its alleged involvement in the events that led to the depegging of TerraUSD (UST) and the demise of the Terra ecosystem – one of the key events that triggered the crypto market downturn in 2022.
“The court reserves the discretion to release confidential materials in connection with future motions or litigation,” the filing states. “Should such disclosure be considered, the court will give advance notice to Jump’s counsel so that counsel can be heard on any objections.”
Before Terra’s collapse, Jump Crypto played a significant role in the company’s ecosystem and participated in financing rounds that were said to be used to create a UST reserve. Investors filed a lawsuit against Jump Trading in May, claiming the company and its CEO Kanav Kariya manipulated the price of UST to reap about $1.3 billion in profits.
In February, the SEC filed charges against Terraform Labs and co-founder Do Kwon for allegedly “orchestrating a multi-billion dollar securities fraud involving crypto assets.” The case was still pending at the time of publication, but both the SEC and Kwon and Terraform Labs filed motions for summary judgment in October.
Authorities in Montenegro arrested and sentenced Kwon in June for using forged travel documents the Terraform co-founder later sentenced to four months in prison. On November 24, a Montenegrin court approved the extradition of Kwon, subject to the approval of the justice minister, meaning he can be sent to either the United States or South Korea to face charges.
