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

Jane Street has petitioned a US court to dismiss a lawsuit filed by the bankruptcy estate of Terraform Labs, denying allegations that its trading activities contributed to the 2022 collapse of TerraUSD and Luna. In court filings, Jane Street and its employees argued that the lawsuit is an attempt to deflect blame for the failure of the Terra ecosystem, which resulted in approximately $40 billion in losses. The company is seeking a dismissal with prejudice, which would prevent Terraform from pursuing the same claims in the future. According to Jane Street, the core issues surrounding Terra's collapse have already been resolved in court, citing criminal and civil cases against Terraform founder Do Kwon, who has been found guilty of conspiracy and wire fraud. The company asserts that Kwon has acknowledged responsibility for the collapse, stating he was 'alone responsible for everyone's pain.' Terraform's lawsuit, filed in January, accuses Jane Street of insider trading, alleging that the company used confidential information to trade ahead of significant market moves. However, Jane Street disputes these claims, maintaining that it had no involvement in Terraform's fraud scheme, which has already been prosecuted and punished. The company's motion to dismiss the lawsuit may have significant implications for the assignment of responsibility for the collapse of the Terra ecosystem, which had far-reaching consequences for the crypto sector.