Terraform Labs’ bankruptcy liquidator has sued Jane Street, accusing the Wall Street trading firm of using nonpublic information to trade ahead of the 2022 Terra-Luna collapse. The complaint also names Jane Street co-founder Robert Granieri and employees Bryce Pratt and Michael Huang as defendants.
Complaint centers on timing of UST withdrawals
According to a report cited from The Wall Street Journal, liquidator Todd Snyder filed the complaint on Monday and said Terraform Labs quietly removed 150 million UST from Curve’s 3pool on May 7, 2022, without making any public announcement. The filing says that about 10 minutes later, a wallet allegedly tied to Jane Street withdrew another 85 million UST from the same pool.
Snyder argues that the timing and size of Terraform’s withdrawal were not publicly known, yet Jane Street moved in near parallel. In the complaint, that sequence is presented as evidence that the firm received inside information and traded before the market unraveled.
Former employee contacts and private chats draw scrutiny
The lawsuit says Jane Street intentionally used Bryce Pratt, a former Terraform Labs employee, to reconnect with former colleagues, including a software engineer and a business development lead. Snyder claims a private chat group made up of former co-workers became a channel through which sensitive internal information from Terraform Labs was passed along to Jane Street.
The filing also says some confidential Terraform information reached Jane Street through Jump Trading. Snyder’s team had already sued Jump Trading and its executives late last year, seeking $4 billion and alleging that the firm used a “backdoor agreement” to artificially support UST.
Jane Street rejects allegations as Terra fallout keeps expanding
Jane Street has denied the allegations. The firm said the Terra-Luna collapse was the result of what it described as a multibillion-dollar fraud by Terraform Labs management, and said it would fight what it called opportunistic claims.
Terra’s ecosystem entered a death spiral in 2022 after UST lost its peg, while LUNA fell more than 99%. More than $40 billion in crypto market value was wiped out, and several crypto lending platforms later failed. Terraform Labs filed for bankruptcy in 2024 and agreed to pay the U.S. Securities and Exchange Commission $4.47 billion in penalties. Founder Do Kwon, after admitting to two criminal charges, was sentenced by a U.S. court last December to 15 years in prison.