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Insider Trading Allegations Surface in Terra Collapse Lawsuit

Emre Yumlu — Tue, 24 Feb 2026 08:00:28 +0000

A new legal battle has emerged from the ashes of the 2022 Terra ecosystem collapse. The administrator overseeing the wind-down of Terraform Labs, Todd Snyder, has filed a lawsuit against high-frequency trading firm Jane Street, accusing the company of insider trading that allegedly accelerated the project’s downfall. The suit also names Jane Street co-founder Robert Granieri, along with employees Bryce Pratt and Michael Huang.

According to the complaint, Jane Street used material nonpublic information related to Terraform’s internal operations to gain an unfair trading advantage in TerraUSD (UST) and Luna markets during a critical period.

Claims of Front-Running and Market Advantage

The lawsuit alleges that Jane Street obtained sensitive, price-moving information from individuals connected to Terraform Labs before it became public. Armed with this knowledge, the firm is accused of engaging in “front-running” — placing trades ahead of anticipated large market moves to secure profits.

Snyder argues that Jane Street leveraged its market relationships to position itself advantageously during one of the most consequential events in crypto history. On behalf of affected creditors, the wind-down team has stated it intends to pursue all legal remedies available.

Jane Street has firmly denied the allegations, characterizing the lawsuit as opportunistic and without merit. The firm has indicated it will vigorously defend itself against the claims.

The Events That Triggered the Collapse

The chain of events dates back to May 7, 2022, when Terraform Labs quietly withdrew 150 million TerraUSD from the Curve3pool liquidity platform. The lawsuit claims that roughly 10 minutes before any public disclosure, a wallet allegedly linked to Jane Street withdrew 85 million UST from the same pool.

The withdrawals contributed to market instability. The following day, Terraform founder Do Kwon stated that the transaction was intended to move liquidity to a new stablecoin pool. However, confidence in TerraUSD quickly eroded.

By May 9, UST had begun losing its 1:1 dollar peg, and the Luna token rapidly collapsed. Within a week, approximately $40 billion in market value was wiped out, triggering widespread losses and impacting multiple crypto firms exposed to the ecosystem.

Aftermath and Ongoing Legal Scrutiny

Founded in 2018 in Singapore by Do Kwon and Daniel Shin, Terraform Labs was best known for the Terra blockchain, Luna token, and algorithmic stablecoin TerraUSD. The company filed for bankruptcy in January 2024, and a wind-down trust assumed control later that year.

In August, Do Kwon pleaded guilty to two criminal charges and received a 15-year prison sentence.

The lawsuit against Jane Street reopens debate over accountability in the Terra collapse. While the outcome remains uncertain, the case may have broader implications for insider trading enforcement and market conduct standards within the crypto industry.

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Stablecoin Surge: Google Searches and Market Cap Hit Record Highs

Emre Yumlu — Tue, 29 Jul 2025 13:00:07 +0000

In July, the term stablecoin experienced an unprecedented surge in Google search interest, reaching an all-time high. This rise aligns closely with recent regulatory developments in the U.S., especially the passage of the GENIUS Act, which sparked renewed attention from institutional investors and accelerated growth in the stablecoin supply.

The last time searches peaked to this extent was back in May 2022, during the dramatic collapse of the Terra ecosystem, where the algorithmic stablecoin UST lost its $1 peg. However, unlike the crisis-fueled spike back then, this latest uptick reflects growing adoption and institutional confidence rather than panic.

A Parabolic Climb in Market Cap

The rising interest isn’t limited to search trends alone. Data from Bitwise reveals that the total market capitalization of stablecoins has reached a record-breaking $272 billion — now representing roughly 7% of the entire crypto market. Notably, USD-backed stablecoins like Tether continue to dominate, accounting for nearly 60% of this share.

Commenting on the exponential rise, Ethereum-based treasury firm SharpLink humorously remarked: “You can’t spell ‘stablecoins’ without ‘parabolic.’”

Stability Amid Volatility

One of the primary reasons behind the soaring popularity of stablecoins is their role as a safe haven during volatile market conditions. Nassar Al Achkar, Strategy Director at CoinW exchange, highlighted the importance of these digital assets in enabling seamless cross-border payments while providing shelter during turbulent periods.

Looking ahead, more institutional players are reportedly preparing to launch their own stablecoin offerings. These initiatives are expected to bridge the gap between traditional finance and the crypto ecosystem, offering a regulated, reliable gateway for investors wary of the volatility in altcoin markets.

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Three Arrows Increases Its FTX Claim to $1.53 Billion!

Yigit Taha OZTURK — Fri, 14 Mar 2025 09:00:34 +0000

The bankrupt crypto hedge fund Three Arrows Capital (3AC) has received approval to increase its claim against the collapsed exchange FTX to $1.53 billion. The U.S. Bankruptcy Court reviewed 3AC‘s request and approved the amended filing, stating that it aimed to protect creditors’ rights.

Legal Battle Between 3AC and FTX

In a case heard in the Delaware Bankruptcy Court, Chief Judge John Dorsey rejected objections from FTX creditors. The FTX side argued that 3AC‘s claim was untimely and an attempt to delay the process. However, the court ruled that FTX‘s delayed response in providing necessary documents had caused the delay.

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3AC initially filed a $120 million claim in June 2023. Later, in November 2024, it increased this amount to $1.53 billion, alleging that FTX had engaged in unjust enrichment and failed to fulfill its obligations. According to 3AC, FTX liquidated $1.33 billion of its funds in 2022, causing significant financial damage.

Current Status of the FTX and 3AC Case

FTX objected to 3AC‘s amended claim, arguing that it was filed too late and lacked sufficient information. However, the court determined that 3AC‘s delays resulted from FTX withholding critical records, leading to the approval of the increased claim.

As the FTX bankruptcy proceedings continue, the exchange has also filed lawsuits against SkyBridge Capital, Binance, and Waves to recover lost funds. FTX is actively pursuing legal action to reclaim assets linked to former CEO Sam Bankman-Fried‘s past financial decisions.

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Binance Clarifies BFUSD Isn’t a Stablecoin

Yigit Taha OZTURK — Tue, 19 Nov 2024 11:00:00 +0000

After Binance announced its new BFUSD token, promising an annual yield of 19.55%, the news quickly spread on social media. This sparked comparisons to Terra‘s collapse, with its algorithmic stablecoin USTC facing a similar fate. In response, Binance clarified that BFUSD is not a stablecoin and has not yet been launched.

How Will BFUSD Work?

BFUSD will be held in UM wallets, with users receiving daily airdrops without needing to lock up their funds. The amount of BFUSD users can earn will depend on their VIP level on Binance. According to the official launch page, BFUSD will be used as collateral for futures trading.

The promise of high yields led some users to express doubts, drawing parallels with the failed Anchor protocol from Terra, which also promised high returns. In May 2022, UST lost its dollar peg, causing the entire Terra ecosystem to collapse, resulting in billions in losses.

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One user asked, “Are we repeating the same mistakes?” while another questioned the sustainability of the yields: “Are we the ones providing the yield?”

Why Binance is Confident in BFUSD

Binance defends BFUSD, stating that it complies with existing regulations and allows users to earn rewards without locking their assets. However, given past failures in the crypto world, promises of high returns are often met with skepticism.

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Avalanche Foundation Reacquires AVAX Tokens Held by LUNA!

Orhan — Thu, 07 Nov 2024 14:30:30 +0000

Following the dramatic collapse of the Terra ecosystem, the Avalanche Foundation made a significant buyback to strengthen its financial structure and independence. Avalanche repurchased $52 million worth of AVAX tokens from the Luna Foundation Guard (LFG), effectively severing all financial ties with Terra. This move represents not just a token buyback but a strategic step towards building a decentralized and trust-focused crypto ecosystem.

The Terra and Avalanche Partnership

The financial collaboration between Avalanche and Terra began in 2022, when Terra founder Do Kwon initiated efforts to establish a large reserve to maintain the peg of the stablecoin TerraUSD (UST) against the U.S. dollar. As part of this initiative, the Luna Foundation Guard decided to build a $10 billion reserve, which included not only Bitcoin but also AVAX tokens from the Avalanche ecosystem. Under their agreement, LFG purchased $100 million worth of AVAX as a strategic reserve, while the Avalanche Foundation bought $200 million worth of UST and LUNA tokens to contribute to the Terra ecosystem.

Shifting Crypto Regulations

However, the unexpected collapse of the Terra ecosystem in 2022 led to a sharp decline in the value of UST and LUNA tokens, triggering a significant crisis of confidence in the crypto markets. This collapse highlighted the need for the crypto industry to become more responsive to regulations and emphasized the importance of financial independence for projects. During this period, the Avalanche Foundation decided to cut its financial ties with Terra, and after obtaining bankruptcy approval from the court, it repurchased AVAX tokens from LFG, formally ending its relationship with the Terra ecosystem.

Why Is Avalanche Reacquiring AVAX Tokens?

This move by Avalanche is seen as an example of how projects can maintain their decentralization goals while protecting themselves against financial crises. After Terra’s collapse, many projects started taking steps to safeguard their financial independence within legal frameworks. The Avalanche Foundation’s buyback is significant in shielding the platform from potential price fluctuations and risks associated with Terra.

This action also sets an important precedent for the stability and growth of the DeFi ecosystem. The decisive steps taken by leading projects can pave the way for more cautious and sustainable financial policies in future partnerships.

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Terra Faces Another Scandal! New Security Flaw Discovered

admin — Sat, 03 Aug 2024 13:00:04 +0000

The Terra blockchain has reported a security breach that led to the theft of tokens worth approximately $3 million.

The recent security breach on the Terra blockchain has resulted in the theft of tokens valued at around $3 million.

The attack targeted a known security vulnerability in the IBC hooks module, a third-party component used for cross-chain contract calls and token movements.

An unidentified hacker exploited this flaw to drain value from bridged assets, including USDC stablecoins and Astroport tokens.

The incident prompted Terra to take immediate action, including the implementation of an emergency patch to prevent further token theft. The blockchain platform coordinated with its validators to deploy a fix addressing the security vulnerability.

Terra stated, “We will work with validators on Terra to implement an emergency patch to address a suspected security vulnerability.”

The security flaw was initially discovered in April across the Cosmos ecosystem and had been patched at that time.

However, a subsequent upgrade to the Terra network in June did not include this patch, leading to the re-emergence of the vulnerability.

Zaki Manian, co-founder of Sommelier Finance, explained the situation: “There was a security flaw in the IBC hooks discovered by Composable Finance in April. It was patched across the Cosmos ecosystem, including on Terra at that time. However, it appears Terra’s June upgrade did not include the patch. All Axelar USDC bridged to Terra was stolen using the IBC hooks exploit. A significant amount of ASTRO was also stolen.”

Terra’s Ongoing Challenges Following 2022 Financial Collapse

This incident marks another significant challenge for Terra, following the major financial collapse of 2022, when the Terra Classic network was hard-forked. The previous crisis was triggered when the algorithmic stablecoin UST lost its peg to the US dollar, causing widespread financial turmoil.

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Terraform Labs Plans to Sell Four Businesses Amid $4.5 Billion Settlement with SEC

Tanju Akbıyık — Thu, 11 Jul 2024 10:00:42 +0000

Under a $4.5 billion agreement with the United States Securities and Exchange Commission (SEC), Bankrupt crypto company Terraform Labs has declared its desire to sell four of its companies, therefore facilitating winding down of its activities.

Companies for Discount

Terraform said on July 9 that it is “actively exploring options” to sell its portfolio monitoring system Pulsar Finance, crypto wallet platform Station, no-code decentralized autonomous organization (DAO) administration system Enterprise, and smart contract automation tool Warp.

Buying Pulsar Finance in November 2023, Terraform declared Chapter 11 bankruptcy in January in Delaware just some months later. In November 2022, the business was introduced to Enterprise. The warp protocol was launched at the end of February, and Station wallet in March, meaning both projects are currently further developed.

Part of Terraform’s “broader wind-down of operations under the terms of its settlement with the US Securities and Exchange Commission” the transaction intends to “maximize value for its creditors and other stakeholders.”

Settlement with SEC

Terraform settled with the SEC this month for $4.5 billion, agreeing to pay around $3.6 billion in disgorgement, a $420 million civil penalty, and almost $467 million in prejudgement interest. Together with Terraform, when signing the consent, Do Kwon, the founder and the former chief executive officer, agreed to Disgorgement of $110 million, prejudgment interest in the total of $14,3 million, and a Civil penalty in the amount of $80 million.

Closing the SEC’s February 2023 lawsuit for securities law violations and fraud against Kwon and Terraform Labs, the settlement also effectively precluded them from the digital assets industry.

Effect on Terra Ecosystem

Originally Terraform developed the US dollar algorithmic stablecoin TerraUSD (UST), now TerraClassicUSD (USTC), which lost its peg to the dollar in May 2022. Terraform also launched the cryptocurrency Terra Luna Classic better known as LUNC. For USTC as well as LUNC, the depeg began the death spiral that saw the assets’ prices plunge more than 100%.

Using data sourced from CoinGecko, the present token, Terra was unmoved with the news it out down 3% on the week to $0. 37 and it is lower by 98% its’s position of the beginning of May of this year at $18,87.

On the divestment of its companies, Terraform has encouraged interested parties to contact CAVU Securities, the firm’s investment banker.

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Bitcoin CEO Warns of 15x Surge Risk as Politicians Turn Bullish

admin — Mon, 27 May 2024 18:00:18 +0000

Samson Mow, the CEO of blockchain firm Pixelmatic, has expressed his skepticism about politicians becoming pro-crypto.

According to a report by Bitcoinist, the renowned CEO, who predicts a $1 million Bitcoin price, commented on recent statements by US presidential candidates regarding cryptocurrencies.

Mow stated that he is not optimistic about politicians becoming pro-crypto, saying:

“While this may seem pleasant in light of previous anti-crypto hostile stances, it’s bad for Bitcoin in the long run.”

Mow further argued that this shift without a strong Bitcoin ethos could pave the way for the next FTX bankruptcy, Terra (LUNA) crash, or Genesis collapse. He emphasized that Bitcoin stands apart from many cryptocurrencies due to its decentralized and censorship-resistant nature.

In this context, the renowned CEO predicts that Bitcoin’s unique features that differentiate it from other cryptocurrencies could be harmed.

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New Development in the Extradition Process of Terra Founder Do Kwon

Tanju Akbıyık — Fri, 23 Feb 2024 11:15:43 +0000

The legal team of former cryptocurrency entrepreneur Do Kwon is preparing to appeal a recent court decision in Montenegro. The court had ordered the Do Kwon to be extradited to the US on fraud charges in South Korea, but this decision is being challenged.

Goran Rodic, the lawyer representing Kwon, said he believes that the “illegal decision” will not be upheld by the Court of Appeals, citing the annulment of two previous rulings. The ongoing legal battle has seen conflicting rulings from two different courts in the Montenegrin capital Podgorica.

The latest ruling by the Supreme Court on Wednesday upheld Kwon’s extradition to the United States while rejecting South Korea’s request. Rodic plans to appeal, criticizing the court for failing to verify the facts. More details will be presented in the upcoming appeal, Rodic said.

Kwon and his partner Han Chang-joon were arrested in Montenegro about a year ago while trying to travel on fake passports. Both men face charges from the US and South Korea linked to the collapse of the TerraUSD stablecoin in 2022. This event wiped out at least $40 billion in investor assets and triggered a downturn in the crypto market. Earlier this month, Montenegro extradited Han Chang-joon to South Korea.

Kwon received a local sentence in Montenegro for using fake travel documents and is being held in extradition custody. Authorities are still deciding which country to extradite Kwon to. In December, an appeals court in Podgorica overturned a previous Supreme Court ruling that allowed extradition to the US or South Korea.

Final approval of extradition rests with Montenegro’s Minister of Justice. A source close to the matter said that the government is inclined to approve extradition to the US. But the decision has not yet been made public.

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Wormhole: Blockchain Interoperability

admin — Thu, 08 Feb 2024 12:59:49 +0000

Wormhole facilitates data transfer between different blockchains, playing a crucial role in communication within the Web3 world. In this article, we will delve into Wormhole: what it is, how it works, and its goals.

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What is Wormhole?

Wormhole is a general message passing protocol that enables communication between different blockchains. It facilitates the transfer of tokens, NFTs, and data, allowing smart contracts and applications built on blockchains to interact with each other and provide cross-chain functionality. Wormhole aims to enhance interoperability in the crypto world and offer new opportunities to its users.

Wormhole is not a blockchain or token bridge. It provides a communication medium between blockchains and offers protocols that serve this purpose.

Features of Wormhole:

Cross-chain bridge: Wormhole acts as a portal bridge that allows the transfer of tokens, NFTs, and data between different blockchains. For example, it enables seamless value transfer between Ethereum and Solana.
Ecosystem partners: Wormhole collaborates with numerous blockchains to expand the cross-chain liquidity ecosystem. It also integrates with dApps like Phantom, Sabre, and Pendle.
Governance layer: Wormhole has a governance layer supported by its native token W. W is required to use Wormhole’s services, participate in governance, and earn rewards.
Supported blockchains: Wormhole currently supports 72 major networks, including Ethereum, BNB Smart Chain, and Solana.

Team Members:

The Wormhole team was founded by developers within Jump Crypto but later separated from Jump Crypto to become an independent foundation. The team, consisting of around 10 individuals, includes:

Dan Reecer: COO (Chief Operating Officer) of Wormhole Foundation and former marketing director of Acala Network.
Robinson Burkey: Commercial Director of Wormhole Foundation. Previously worked at Jump Crypto.
Michael Zargham: Technical Advisor to Wormhole Foundation. Also the founder and CEO of BlockScience.
Anatoly Yakovenko: Advisory Board Member of Wormhole Foundation. Also the founder and CEO of Solana.
Do Kwon: Advisory Board Member of Wormhole Foundation. Also the founder and CEO of Terra.

The Wormhole team aims to increase interoperability in the crypto world and provide new opportunities for its users.

Roadmap:

Established in 2023, Wormhole’s roadmap so far includes:

Wormhole 2.0: Scheduled for release in Q1 2024, the second version of Wormhole will offer support for more blockchains, more data types, and more application support.
Wormhole ZK: Wormhole’s zero-knowledge proofs (ZK)-based interoperability solution, to be released in Q2 2024, will make data transfer between blockchains faster, cheaper, and more secure.
Wormhole DAO: The decentralized autonomous organization (DAO) of Wormhole, to be launched in Q3 2024, will provide a governance layer supported by the native token W. Wormhole DAO will allow the community to vote on the future direction and parameters of Wormhole.
Wormhole 3.0: Set to be released in Q4 2024, the third version of Wormhole will offer more features, greater scalability, and enhanced security.

Tokenomics:

W has a total supply of 10 billion, with an initial circulating supply of 1.8 billion. It can be transferred to any network that Wormhole is connected to using Solana SPL and Ethereum ERC20. W is distributed among the following categories:

Community: 17% (1.7 billion W) is allocated to Wormhole’s users, developers, and supporters. 11% of this (1.1 billion W) will be distributed to the community as an airdrop.
Foundation: 23% (2.3 billion W) will be used by the Wormhole Foundation for the development, growth, and sustainability of the platform.
Contributors: 12% (1.2 billion W) is reserved for Wormhole’s developers, researchers, designers, marketers, and operators.
Ecosystem: 31% (3.1 billion W) is allocated to Wormhole’s ecosystem partners and dApps.
Strategic Partnerships: 9% (900 million W) is allocated to Wormhole’s strategic investors, advisors, and industry partners.
Guardian Nodes: 8% (800 million W) is allocated to guardian nodes that ensure the security,

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