A July 9 order also rejected four late crypto-loss claims, but did not determine whether Jump Trading owes money or what creditors may recover.
A Delaware bankruptcy court has allowed Terraform Labs’ Plan Administrator to use Jump Trading documents in litigation seeking at least $4 billion, while separately rejecting four late crypto-loss claims in a ruling that narrows, but does not close, the field of potential recoveries. The orders do not decide whether Jump Trading is liable or how much Terraform creditors might ultimately receive. In a July 8 order, Bankruptcy Judge Brendan L. Shannon found the Plan Administrator had violated a protective order by using “Jump Reproduced Documents” in an Illinois lawsuit. He then modified that order so the materials can be used in the Jump action, including in an amended complaint, with immediate effect. Questions over whether the documents should lose confidentiality protections were left to the Illinois court. The administrator alleges the case seeks at least $4 billion and centers on claims that Jump entered a secret arrangement to support TerraUSD and received $1.5 billion in Bitcoin reserves without written agreements or oversight. Those allegations have not been adjudicated. Jump argued the documents were reproduced only for use within the bankruptcy, and said changing the order would let the administrator sidestep a discovery stay (pause in evidence gathering) in securities cases while exposing competitively sensitive information. A separate signed order entered July 9 as Docket 1281 denied motions from four named people to file crypto-loss claims after the deadline and instructed Kroll, the claims agent, to update the register. The ruling followed a July 8 certification filed as Docket 1276. It did not say that all late claimants are barred. The administrator has reported about 16,640 submitted crypto-loss claims, with determinations continuing on a rolling basis. Submitted claims are distinct from allowed claims, which determine who can participate in distributions. For creditors, the practical implication is that any incremental recovery now depends on the Jump lawsuit surviving early procedural challenges and ending in either a judgment or settlement. If that happens, net proceeds could add to the estate available for allowed claims; if not, permission to use the documents alone does not create value.