• Jump Crypto, a Chicago-based subsidiary of Jump Trading, is reportedly the US trading firm that made over $1.28 billion off Luna tokens according to the SEC.
• The SEC has charged Terraform Labs and its CEO Do Kwon with misrepresenting human effort as a software algorithm in order to help TerraUSD (UST) regain its $1 peg.
• The US-based trading firm secured a deal with Terraform Labs to buy Luna tokens at massive discounts, allowing them to make huge profits when they were sold on secondary markets.
Jump is the ‚US trading firm‘ that made $1.28 billion off LUNA: report
The US Securities and Exchange Commission (SEC) recently filed charges against Terraform Labs and its CEO Do Kwon for misrepresenting human effort as a software algorithm in order to help TerraUSD (UST) regain its $1 peg. Sources now claim that the unidentified trading firm is Jump Crypto, a Chicago-based subsidiary of Jump Trading.
Jump’s Deal with Terraform Labs
Jump had been providing market making services for Luna since 2019, but it was not until May 2021 – when UST de-pegged – that the company stepped in to buy Luna tokens at massive discounts from Terraform Labs. This allowed them to make huge profits when they were sold on secondary markets, leading them to realize over $1.28 billion in profit from their trades.
Despite helping UST regain its dollar parity via this deal, Terra misled the public by presenting the re-pegging as a result of the stablecoin’s software algorithm rather than human effort put forth by third parties such as Jump Crypto.
SEC Charges Against Kwon and Terraform Labs
The SEC has thus brought charges against Kwon for his role in this mismanagement of funds and failure to disclose crucial information regarding Jump’s involvement in helping UST repeg.
Ultimately, it appears that Jump Crypto was able to take advantage of an opportunity presented by Kwon and his team at Terraform Labs which led them to reap massive profits while deceiving investors into believing they were dealing with an automated system instead of humans making decisions behind the scenes.