Jump helped Terra deal with UST de-anchoring incident, but was not accused of wrongdoing

Wall Street Journal (WSJ) reporter Alexander Osipovich wrote on X platform that Jump Trading is an important supporter of Do Kwon's Terra/Luna project. Evidence disclosed by the SEC shows that Kwon has a close relationship with Kanav Kariya, president of Jump Crypto. According to screenshots of Kanav's chat with Kwon, Kanav insisted on using Signal to communicate (because the chat records can be deleted) and said that Jump was promoting this practice. In 2020, Jump agreed to provide liquidity for UST and Luna, which was very important to Kwon. Kwon informed major investors in January 2020, adding that the news was "strictly confidential." In return, Jump received call options on Luna, which later became very profitable as Luna prices soared. However, in May 2021, UST broke its anchor and fell below $1. James Hunsaker, a former Jump employee and now an SEC whistleblower, later testified that Kanav said he had communicated with Kwon. Jump then began actively trading to help UST restore its peg. Jump co-founder Bill DiSomma approved risking "hundreds of millions of dollars" to save UST, saying it was critical to Jump's credibility in the cryptocurrency space. At the time, Terraform Labs internally acknowledged Jump's role in saving UST. However, in its external publicity, Terraform Labs did not mention Jump's role in helping to restore its token peg. The SEC believed that Terraform Labs' failure to disclose Jump's role was a material omission that constituted securities fraud. The jury agreed. Notably, Jump was not accused of any wrongdoing. Kanav Kariya and Bill DiSomma were not accused of wrongdoing. However, in the case against Terraform Labs, when the US SEC subpoenaed them for evidence, both refused to testify on the grounds of the Fifth Amendment to the US Constitution (which uses legal procedures to prevent the abuse of government power). Earlier news, Do Kwon was found responsible for civil fraud. It is reported that the SEC charged Terraform and Kwon in February 2023 for the collapse of the algorithmic stablecoin TerraUSD (UST).