TLDR
- Jane Street was sued by Terraform’s bankruptcy administrator for suspected insider trading connected to the Terra/Luna crash in May 2022
- An ex-Terraform intern working at Jane Street purportedly shared privileged information through a chat group named “Bryce’s Secret”
- Jane Street reportedly pulled 85 million UST from Curve’s 3pool just 10 minutes after Terraform’s undisclosed withdrawal, reportedly dodging losses exceeding $200 million
- India’s SEBI independently banned Jane Street from the country’s securities markets in 2025 over accusations of index manipulation generating approximately $4.3 billion in gains
- Jane Street rejects both sets of allegations, describing the cryptocurrency lawsuit as “desperate” and characterizing the SEBI investigation as “biased”
A federal lawsuit has been filed against prominent trading firm Jane Street by Terraform Labs’ court-appointed bankruptcy administrator, claiming the company exploited inside information to gain from the catastrophic $40 billion Terra/Luna crash in May 2022.
The legal action was initiated on February 23 in the Southern District of New York. Named defendants include Jane Street co-founder Robert Granieri along with staff members Bryce Pratt and Michael Huang.
Pratt completed a summer internship at Terraform Labs in 2021 before transitioning to Jane Street in September of that year. By February 2022, he had established a group chat titled “Bryce’s Secret” that incorporated Terraform engineers and business development personnel.
According to one message referenced in the filing, a Terraform engineer stated: “bro we all know who the buyer is. its where u work… Jane Streeeeeeeet.”
The core accusation revolves around events on May 7, 2022. Terraform discreetly extracted 150 million UST from Curve’s 3pool liquidity pool without making any public disclosure. Remarkably, within just 10 minutes, a wallet associated with Jane Street withdrew 85 million UST from the identical pool — representing the largest individual transaction the platform had ever executed.
The filing asserts that this trade “would have been impossible without inside information.” Administrator Todd Snyder contends Jane Street exploited privileged knowledge to liquidate hundreds of millions in UST positions before the market’s complete breakdown.
TerraUSD broke its dollar peg mere days afterward. Its companion token Luna experienced a catastrophic death spiral that obliterated approximately $40 billion in market capitalization within a matter of days.
The Allegations in Detail
The lawsuit encompasses 13 separate charges including insider trading, securities fraud, violations of the Commodity Exchange Act, unjust enrichment, and breach of confidence. The filing demands damages, profit disgorgement, and a jury trial.
Significant portions of the complaint remain redacted. Critical profit calculations and internal correspondence stay sealed under court order.
Jane Street has categorically denied all charges and characterized the lawsuit as a “desperate” and “transparent attempt to extract money.” The company maintains that losses stemmed from the “multibillion-dollar fraud perpetrated by the management of Terraform Labs.”
Terraform founder Do Kwon received a 15-year prison sentence in December 2025 for wire fraud and conspiracy charges.
Jane Street Also Faces Indian Regulators
The Terraform lawsuit represents just one of Jane Street’s ongoing legal challenges. In July 2025, India’s securities regulator SEBI prohibited Jane Street from participating in Indian securities markets, claiming the firm manipulated the BANKNIFTY and NIFTY 50 indices across 18 derivative expiration dates spanning January 2023 through March 2025.
SEBI estimated profits at approximately $4.3 billion from the purported manipulation scheme and froze roughly $566 million in alleged gains.
Jane Street has characterized the SEBI investigation as “biased” and filed an appeal. The appeal hearing was postponed on February 25, 2026 — coinciding with the same week the Terraform legal action was filed.
The company also serves as one of four authorized participants for BlackRock’s iShares Bitcoin Trust, holding approximately $790 million in reported IBIT shares as of Q4 2025.
A distinct lawsuit filed in December 2025 alleges Jump Trading engaged in a covert agreement to purchase Luna at $0.40 while the market price stood at $110.
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