SEC Investigates Jump Trading for $1.2B Terra Transaction

The US Securities and Exchange Commission (SEC) has alleged that Jump Trading earned $1.2bn from investing in the LUNA cryptocurrency to restore the broken dollar peg of its sister coin TerraUSD. The agency has filed papers naming Jump as the anonymous beneficiary mentioned in its civil suit against Terraform Labs CEO Do Kwon in December. Kwon’s lawyers say Jump’s LUNA buys accounted for only 6% of transactions used to restore UST’s peg. TerraUSD fell to just pennies in May 2022 after large weekend withdrawals broke its dollar peg, sending itself and its sister coin, LUNA, tumbling. The SEC and the US Department of Justice have charged Kwon with the $40bn collapse of TerraUSD. Investors have sued Jump and its boss Kanav Kariya, following social media rumours that Jump was the unnamed partner in the original SEC suit. Investors claim Jump’s Solana validator and acquiring a wormhole bridge artificially boosted its UST business.