Fracture Labs, a game development company, has filed a lawsuit against Jump Trading, accusing the firm of manipulating DIO tokens in a 'pump and dump' scheme.

Case Circumstances

In the lawsuit filed on October 15 in an Illinois District Court, Fracture Labs claims to have entered an agreement in 2021 with Jump as a market maker to assist with the initial offering of their DIO token on the Huobi exchange, now known as HTX. As part of this agreement, the company loaned 10 million DIO tokens, valued at $500,000, to Jump and separately sent 6 million tokens, worth $300,000, to HTX. After the launch, Jump allegedly sold all holdings, triggering a sharp price decline.

Fracture Labs' Stance

Fracture Labs argues that Jump took advantage of the DIO price spike, selling the tokens and then re-acquiring them at a lower price. This action, according to the claimant, led to a significant devaluation of the token, making investor attraction difficult.

Court Demands

The company accuses Jump Trading of fraud and deceit, civil conspiracy to commit fraud, breach of contract, and breach of fiduciary duty. Fracture Labs demands a jury trial, restitution of damages, and disgorgement of illicit profits.

The court proceedings might shed light on token trading practices, industry player relationships, and the impact of price manipulations on the market.