Jane Street Seeks Dismissal of Terraform Lawsuit Over UST-LUNA Collapse

Jane Street has filed a motion to dismiss a lawsuit brought by the Terraform Labs bankruptcy estate, arguing that it is an attempt to deflect responsibility for the 2022 collapse of the TerraUSD stablecoin and its sister token, Luna. The company asserts that the lawsuit, which alleges insider trading, is an effort to shift the blame for the failure of the Terra ecosystem, which wiped out approximately $40 billion in value. In its filing, Jane Street contends that the core issues surrounding Terra's collapse have already been resolved in court, citing the criminal and civil cases against Terraform founder Do Kwon, who has been sentenced to 15 years in prison for conspiracy and wire fraud. Jane Street denies any involvement in the collapse and argues that Terraform's fraud scheme has already been prosecuted and punished. The company is seeking to have the complaint dismissed with prejudice, which would prevent Terraform from pursuing the same claims in the future. The lawsuit, filed by Terraform administrator Todd Snyder, accuses Jane Street of using nonpublic information to trade ahead of major moves, including large withdrawals from the Curve liquidity pool that preceded UST losing its dollar peg. However, Jane Street disputes this narrative, maintaining that it had no role in the collapse and that Terraform's fraud scheme has already been adjudicated.