Jane Street Accused of Bitcoin Manipulation
Terraform Labs filed suit against trading firm Jane Street, alleging systematic Bitcoin manipulation through "daily 10 a.m. dumps" linked to FTX's Sam Bankman-Fried. After the lawsuit, Jane Street "deleted all X/Twitter posts," a move seen as potentially incriminating. The case could drive greater transparency and enforcement in crypto trading operations, with potential ripple effects on market structure.
- The lawsuit, filed by Terraform Labs' bankruptcy administrator, alleges that a former Terraform intern, Bryce Pratt, provided Jane Street with non-public information after joining the trading firm. This information was allegedly shared through a private chat group called "Bryce's Secret," which included a Terraform software engineer and its head of business development. - The core of the accusation centers on a specific event on May 7, 2022, when Terraform Labs withdrew 150 million of its TerraUSD (UST) stablecoin from a liquidity pool without a public announcement. Just ten minutes later, a wallet connected to Jane Street allegedly withdrew $85 million in UST from the same pool, a move the lawsuit claims would have been impossible without inside knowledge. - The lawsuit seeks to recover funds for creditors who lost money in the $40 billion collapse of the Terra ecosystem. Jane Street has publicly dismissed the lawsuit as a "desperate" and "baseless" attempt to extract money, stating that the losses were due to the "multibillion-dollar fraud perpetrated by the management of Terraform Labs." - The lawsuit also names Jane Street's co-founder Robert Granieri and employee Michael Hwang as defendants alongside Bryce Pratt. This legal action follows a similar suit filed by the Terraform administrator against another trading firm, Jump Trading, in December 2025. - Sam Bankman-Fried, the founder of the collapsed FTX exchange, began his finance career at Jane Street, working there from 2014 to 2017. Several other key figures from FTX and Alameda Research were also alumni of the trading firm. - This is not the only instance of Jane Street facing accusations of market manipulation. In 2025, the Securities and Exchange Board of India accused the firm of manipulative trading in index derivatives. That regulator impounded approximately $566 million in alleged unlawful gains. - While social media buzzed with speculation that Jane Street deleted its X/Twitter history in response to the lawsuit, some trading professionals noted the account has been largely inactive since its creation in 2018, suggesting the "zero tweets" status may not be a recent development.
