Do Kwon-founded Terraform Labs has once more pointed the finger at market maker Citadel Securities for its function in an alleged “concerted, intentional effort” to trigger the depeg of its stablecoin in 2022.
On Oct. 10, Terraform Labs filed a movement in the US District Court docket within the Southern District of Florida to compel Citadel Securities LLC to supply paperwork regarding its buying and selling actions in Could 2022, across the time its stablecoin, now referred to as TerraUSD Basic (USTC), depegged.
It contends the Could 2022 depeg, when the asset crashed from $1 to $0.02, was attributable to “sure third-party market individuals” deliberately shorting the stablecoin, versus instability in its algorithm.
“Movant [Terraform] contends that the market destabilization that occurred didn’t consequence from instability within the algorithm underlying the UST stablecoin,” mentioned the agency in its movement.
“As a substitute, Movant contends that the market was destabilized as a result of concerted, intentional effort of sure third occasion market individuals to “brief” and trigger UST to depeg from its one greenback value.”
The movement additionally cites “publicly obtainable proof” suggesting that Citadel head Ken Griffin supposed to brief the stablecoin across the time of the depeg.
“There may be publicly obtainable proof suggesting that the pinnacle of the Citadel Entities, Ken Griffin, supposed to brief UST at or in regards to the time of the Could 2022 depeg.”
The submitting cited a screenshot from a Discord channel chat through which a pseudonymous dealer had lunch with Griffin, who allegedly mentioned “They had been going to Soros the f*** out of Luna UST,” presumably in reference to George Soros’ buying and selling methods — centered round extremely leveraged, one-way bets.
Citadel Securities has nonetheless beforehand denied buying and selling the TerraUSD stablecoin in Could 2022, in line with Forbes.
Cointelegraph contacted Citadel for extra remark however didn’t obtain a right away response.
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In its movement, Terraform argues that the paperwork are essential for its protection within the lawsuit filed by the U.S. Securities and Trade Fee in February, which alleges Terraform Labs and its founder, Do Kwon, had a hand in “orchestrating a multi-billion greenback crypto asset securities fraud.”
“This protection might be considerably impaired if Citadel Securities is profitable in withholding this restricted info,” it said.
If the courtroom refuses to compel Citadel to supply the buying and selling paperwork, Terraform requested the matter be transferred to the U.S. District Court docket for the Southern District of New York for determination by Decide Rakoff.
In July, Terraform Labs sought permission from a decide to subpoena knowledge from bankrupt crypto change FTX, additionally claiming the knowledge might assist its protection.
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