Jump Crypto Identified as Third-Party Trading Company Profiting $1.28 Billion from Crash UST
Key Points: Jump Trading, an unnamed U.S.-based trading company, was charged by the SEC with aiding in the backing TerraUSD stablecoin’s de-pegged dollar in 2021.
The trading company made more than $1 billion in profits.
According to The Block, Jump Crypto is a U.S. trading company that the Securities and Exchange Commission claimed supported TerraUSD stablecoin. The company’s CEO, Do Kwon was also charged with civil violations by U.S. Securities and Exchange Commission. The defendants are accused of misleading investors by using a U.S.-based trading firm to support TerraUSD’s value in May 2021. According to the people, Jump Crypto was the name of the company. The company used a U.S. trading firm to support TerraUSD’s value in May 2021. Investors lost billions of dollars when TerraUSD crashed in May 2022. The SEC did however charge Terraforms with de-pegging, claiming that Terraforms used human traders to maintain its value, rather than the software program.
“In May 2021 when the value UST was ‘unpegged” from the U.S. Dollar, Terraform, through Kwon discussed plans with a third party. The ‘U.S. UST to restore its value. UST’s value rose again as a result of these efforts. The defendants misleadingly claimed to the public that UST’s algorithm had successfully repegged UST to $1.
Terraform Labs claims that the stablecoin UST would be fixed at $1 due to a cutting-edge algorithm. This algorithm was created to issue and burn LUNA (a speculative sister token to TerraUSD) in order to act as a shock absorber for UST’s price. The algorithm was written in blockchain-based computer code known as smart contracts. It was designed to issue and burn LUNA, the speculative sister token of TerraUSD, to serve as a shock absorber for the price of UST. Terraform Labs claimed that Terraform was able to buy LUNA at as low as 40c when it was being sold for $90 on open market. This was despite the fact that the TerraUSD stablecoin briefly lost $1 from its $1 peg in May 2020. According to the SEC, Terraform Labs and Kwon were charged with soliciting billions from investors by marketing and selling a related suite of crypto assets securities. Many of these transactions were conducted in unregistered transactions. mAssets are security-based swaps that mimic the price of stocks in the United States. We encourage you to do your own research before investing.Join us to keep track of news: https://linktr.ee/coincuHaroldCoincu NewsTags: do kwonjump cryptoSECTerraUST