Jane Street, a prominent trading firm, is under fire as allegations surface regarding its involvement in significant disruptions within the cryptocurrency market. A federal lawsuit has been filed, raising serious questions about the firm's trading practices leading up to the collapse of the Terra Luna ecosystem. The document underscores a growing issue that could have far-reaching implications for the entire industry.
Overview of the Lawsuit
The lawsuit, filed on February 23, 2023, in the US District Court for the Southern District of New York, accuses Jane Street of utilizing confidential information from Terraform Labs to protect itself from over $200 million in potential losses before the May 2022 collapse. Jane Street has vehemently denied these allegations, describing the lawsuit as a 'desperate attempt to extract money.'
Allegations of Market Manipulation
In addition to the lawsuit, online claims have emerged suggesting that Jane Street may have manipulated Bitcoin prices using a specific trading algorithm. Market commentator MartyParty has reported that Trump Media has reached out to Congress, urging an investigation into Jane Street and other firms for alleged naked short selling, a practice that is restricted under US securities law. As of Thursday afternoon, there has been no official confirmation regarding this letter or any public statements from the parties involved.
In light of the recent allegations against Jane Street, a new investigation by ZachXBT has revealed serious insider trading claims at Axiom Exchange. For more details, see the full report on the allegations.
