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Jane Street Sued Over Alleged $134 Million Profit From UST Trading

Jane Street Sued Over Alleged $134 Million Profit From UST Trading

The latest report says the lawsuit could increase scrutiny of trading firms’ use of private communication channels, including Telegram, in crypto market activity and potential insider trading investigations.

Fact Check
The claim that Jane Street was sued over an alleged $134 million profit from UST trading is strongly supported by multiple independent, credible sources. CoinDesk (the primary source linked in the claim), Crypto Briefing, Yahoo Finance, TheStreet, and others all consistently report the same core facts: Terraform's bankruptcy estate filed a lawsuit in Manhattan federal court alleging Jane Street used insider information via a private Telegram group to exit a ~$192-193 million UST position and generate approximately $134 million in profits through short positions during the May 2022 Terra collapse. The lawsuit's existence is further corroborated by April 2026 reporting on Jane Street's motion to dismiss. The $134 million figure is consistent across all sources. The only caveat is that these are allegations in an active lawsuit - Jane Street denies wrongdoing - so the underlying facts of insider trading have not been adjudicated. The claim as stated (that Jane Street was sued over the alleged profit) is factually accurate.
Summary

Newly unsealed court filings and a lawsuit allege that Jane Street used nonpublic information from Terraform Labs, including access discussed in a private chat labeled "Bryce’s Secret," to gain an informational edge before the collapse of UST, or TerraUSD. According to the complaint, Jane Street sold about $192 million of UST, including roughly $85 million on Curve nine minutes after Terraform Labs removed $150 million of liquidity on May 7, 2022, and built short positions that allegedly helped generate about $134 million in profit. The filings tie the timing of those trades to Terraform Labs’ liquidity move and broader market stress during the Terra ecosystem’s failure. Jane Street denied the allegations. The latest report adds that the case could set a precedent for increased scrutiny and regulation of trading firms’ use of private communication channels such as Telegram.

Terms & Concepts
  • UST: UST, or TerraUSD, was an algorithmic stablecoin designed to maintain a one-dollar value through a balancing mechanism with Terra’s related token rather than traditional cash reserves.
  • Short positions: Short positions are trades that profit when an asset’s price falls, typically by borrowing and selling first, then buying back later at a lower price.
  • Curve: Curve is a decentralized exchange focused on efficient swaps between similar crypto assets, including stablecoins.