Terraform Labs sues Jane Street, alleging insider trading during TerraUSD's 2022 collapse.

Todd Snyder, administrator for Terraform Labs, has sued Jane Street Group and its executives, alleging the firm engaged in insider trading and front-running during the 2022 collapse of TerraUSD and Luna. The lawsuit claims Jane Street used non-public information from back-channel communications with Terraform insiders, including former intern Bryce Pratt, to sell 85 million TerraUSD tokens within minutes of a major liquidity withdrawal, accelerating the stablecoin’s collapse. The firm is accused of profiting from sensitive data, including messages with co-founder Do Kwon, and seeking damages. Jane Street denies the allegations, calling them baseless and blaming Terraform’s leadership for the failure. The case is ongoing in Manhattan federal court.