Terraform Labs Accuses Citadel Securities of Destabilizing its UST Stablecoin
The post Terraform Labs Accuses Citadel Securities of Destabilizing its UST Stablecoin appeared on BitcoinEthereumNews.com. In the latest twist, Terraform Labs, a defunct crypto network, is accusing Citadel Securities of participating in intentional efforts to destabilize its stablecoin TerraUSD classic (USTC) in 2022, eventually leading to its demise. This comes as both Terraform Labs and its founder, Do Kwon, continue to face legal troubles. Terraform Labs Accusing Citadel In a document filed in a United States District Court in the Southern District of Florida on Oct. 10, the defunct crypto network asked the court to compel Citadel Securities LLC to produce documents related to its trading activities in May 2022, when USTC depegged. USTC plunged dramatically last May, losing its peg by nearly 70% in mere hours and eventually crashing to $0.02 later that month. While there were claims of instability in the algorithm initially, Terraform now claims that the plunge was mainly because of some third-party market participants. In its documentation, Terraform cites “publicly available evidence” suggesting that the head of Citadel Securities, Ken Griffin, planned to short the stablecoin around that time. A representative of Terraform Labs noted, “We contend that the market destabilization did not result from instability in the algorithm underlying the UST stablecoin. Instead, certain third-party market participants intentionally shorted it, causing it to depeg from its one dollar price.” The report mentioned evidence from a Discord chart where an anonymous individual claimed that Griffin planned to use George Soros’ trading strategies on Luna UST. Soon after UST’s troubles in early May 2022, an X (Twitter) user @JacobCanfield, who now has about 90K followers, tweeted on May 9 that the “[r]umor is citadel is the culprit” through borrowing 100K BTC and using it to open a short position on UST. They later started dumping UST to make it lose its peg. The document mentions that Citadel’s $61 billion in resources…
The post Terraform Labs Accuses Citadel Securities of Destabilizing its UST Stablecoin appeared on BitcoinEthereumNews.com.
In the latest twist, Terraform Labs, a defunct crypto network, is accusing Citadel Securities of participating in intentional efforts to destabilize its stablecoin TerraUSD classic (USTC) in 2022, eventually leading to its demise. This comes as both Terraform Labs and its founder, Do Kwon, continue to face legal troubles. Terraform Labs Accusing Citadel In a document filed in a United States District Court in the Southern District of Florida on Oct. 10, the defunct crypto network asked the court to compel Citadel Securities LLC to produce documents related to its trading activities in May 2022, when USTC depegged. USTC plunged dramatically last May, losing its peg by nearly 70% in mere hours and eventually crashing to $0.02 later that month. While there were claims of instability in the algorithm initially, Terraform now claims that the plunge was mainly because of some third-party market participants. In its documentation, Terraform cites “publicly available evidence” suggesting that the head of Citadel Securities, Ken Griffin, planned to short the stablecoin around that time. A representative of Terraform Labs noted, “We contend that the market destabilization did not result from instability in the algorithm underlying the UST stablecoin. Instead, certain third-party market participants intentionally shorted it, causing it to depeg from its one dollar price.” The report mentioned evidence from a Discord chart where an anonymous individual claimed that Griffin planned to use George Soros’ trading strategies on Luna UST. Soon after UST’s troubles in early May 2022, an X (Twitter) user @JacobCanfield, who now has about 90K followers, tweeted on May 9 that the “[r]umor is citadel is the culprit” through borrowing 100K BTC and using it to open a short position on UST. They later started dumping UST to make it lose its peg. The document mentions that Citadel’s $61 billion in resources…
What's Your Reaction?
