Jump Trading slams $4bn Terraform lawsuit as attempt to ‘pass the buck’

A leading firm in the secretive world of high-speed trading hit back on Monday after it was accused of defrauding investors by Todd Snyder, the man charged with leading Terraform Labs through bankruptcy.

In a December lawsuit, Snyder accused Chicago-based Jump Trading, several of its subsidiaries, and two of its executives of market manipulation, defrauding investors, self-dealing, and more.

Now, Jump says the lawsuit is a “transparent attempt” to dodge a $4.4 billion fine levied by the Securities and Exchange Commission in 2024.

Snyder “concocts a host of claims designed to pass the buck of Terraform’s liability to the SEC and Terraform’s creditors from Terraform to Defendants,” Jump said in its response.

Terraform Labs is the company behind one of the most infamous projects in crypto history: the Terra blockchain and its twin cryptocurrencies, UST and LUNA. Their spectacular collapse in 2022 set off a chain reaction that culminated in the bankruptcy of FTX and a regulatory crackdown targeting crypto companies large and small.

In total, Terraform Labs and its cocksure founder, Do Kwon, cost investors some $40 billion in losses.

Terraform and Kwon were sued by the SEC in 2023. A year later, they were found guilty and ordered to pay fines of $4.4 billion and $204 million, respectively. In a separate criminal case, Kwon pleaded guilty to two counts of fraud. In December, a US judge sentenced him to 15 years in prison.

While Kwon begins a lengthy prison sentence, the Jump executives who allegedly helped him perpetuate his fraud have evaded accountability, according to Snyder’s lawsuit, which seeks $4 billion in damages.

“This case is about a secretive trading firm that defrauded investors and contributed to one of the largest cryptocurrency collapses in history,” it reads. “This lawsuit is how the estate of Terraform and the victims of Jump’s wrongful conduct will finally hold Jump responsible.”

The alleged fraud began when UST lost its peg to the US dollar in 2021.

Jump helped Terraform defend UST’s peg, buying enormous quantities of the token in an attempt to bolster its price, according to court records.

But executives at both companies kept their effort a secret, as admitting that UST was unstable would have negatively impacted Jump’s investment in the affiliated LUNA token, Snyder alleged.

In a lengthy response filed Monday, Jump said the lawsuit lacked key details and should be dismissed.

For example, the lawsuit refers to eight separate, but affiliated entities as “Jump,” “failing to plead with particularity what any specific Defendant did,” the response reads.

Moreover, the lawsuit does not state where any of the alleged violations occurred, according to Jump. Even if it had, the lawsuit was filed well after the statute of limitations.

Snyder was confirmed to lead the Terraform Labs Wind Down Trust in September 2024.

In a separate lawsuit last month, Snyder sued high-frequency trading firm Jane Street, its co-founder Robert Granieri, and two employees named Michael Huang and Bryce Pratt.

The heavily redacted lawsuit claims that the trading firm was able to profit from “trades that would have been impossible without inside information to which it had unique access.”

Jane Street, which earned more than $24 billion in the last quarter of 2025, told the Wall Street Journal the complaint was “desperate” and said it would defend itself “vigorously against these baseless, opportunistic claims.”

Aleks Gilbert is DL News’ New York-based DeFi correspondent. Have a tip? Email him at aleks@dlnews.com.