Jane Street Accused of Insider Trading in TerraUSD Collapse

Allegations and Legal Proceedings High-frequency trading giant Jane Street is facing accusations of insider trading that allegedly accelerated the 2022 collapse of TerraUSD (UST), an event that resulted in billions of dollars in losses across the cryptocurrency market.
The lawsuit, filed by Terraform Labs liquidator Todd Snyder, seeks damages from the firm’s co-founder Robert Granieri and employees Bryce Pratt and Michael Huang.
Snyder alleges that Jane Street used critical, non-public information obtained from sources within Terraform to manipulate the market for its own benefit and secure unfair profits.
Transactions That Triggered the Collapse According to the legal filing, the events began on May 7, 2022, when Terraform withdrew 150 million UST from the decentralized trading platform Curve3pool.
The lawsuit claims that in the 10 minutes before this transaction was publicly announced, a wallet linked to Jane Street withdrew 85 million UST from the same pool.
This move is said to have triggered market panic and initiated the process that led to the stablecoin losing its peg to the U.S.
dollar.
Additionally, the case file notes that on May 9, Jane Street employee Bryce Pratt contacted Do Kwon and his team with offers to purchase Bitcoin or Luna.
Jane Street’s Response and Background A spokesperson for Jane Street denied the allegations, describing the lawsuit as a "desperate attempt to seek money." The company argued that the losses suffered by Terra and Luna holders were the result of a multi-billion dollar fraud perpetrated by Terraform Labs management.
Founded in 2018, Terraform Labs filed for bankruptcy in January 2024.
The project's collapse wiped out approximately $40 billion in market value and led to the imprisonment of founder Do Kwon on various charges.