SEC Charges Jump Crypto Subsidiary for Terra UST Deception
Tai Mo Shan, a wholly-owned subsidiary of Jump Crypto, has agreed to a $123 million settlement with the U.S. Securities and Exchange Commission (SEC) for misleading investors about the stability of TerraUSD (UST) Stablecoin.
Jump Crypto is a subsidiary of Chicago-based proprietary trading firm Jump Trading and is an integral part of the Terra ecosystem. The company is currently under investigation by the U.S. Commodity Futures Trading Commission futures Trading Commission (CFTC).
Tai Mo Shan settles with SEC over TerraUSD misleading claims
On December 20, the U.S. Securities and Exchange Commission (SEC) highlighted Tai Mo Shan’s UST decoupling crisis. The company attempted to stabilize UST by purchasing over $20 million in stablecoins.
The SEC claims this sends the wrong signal to the market: Terra Algorithmic mechanisms effectively maintain their value. However, this action failed to prevent widespread disruption and significant investor losses caused by the decoupling event.
In addition, the SEC alleged that Tai Mo Shan acted as Terra’s statutory underwriter Luna Token. The agency alleged that the company managed the assets as securities through unregistered transactions. Their strategy involves planning the distribution of these tokens American trading platform From January 2021 to May 2022.
SEC Chairman Gary Gensler Highlighting the wider impact of the incident, statement:
“(The impact of the UST cancellation) reverberated throughout the cryptocurrency market, ultimately costing countless investors their savings. Regardless of label, cryptocurrency market participants are expected to comply with applicable securities laws and not deceive the public. Otherwise, investors will be harmed.”
As part of the settlement, Tai Mo Shan will pay $73,452,756 in disgorgement, $12,916,153 in prejudgment interest and $36,726,378 in civil penalties. The company did not admit or deny the SEC’s findings but agreed to a cease-and-desist order to prevent future violations of registration and fraud regulations.
This settlement comes after Terraform and its Founder Quan Dao Found responsible for fraudulent and unregistered securities offerings. they agree substantively $4.5 billion in payments Compensate affected investors.
January 2024 Terraform Labs declares bankruptcy. The company has since transferred control of the Terra blockchain to the community and discontinued some products and services.
Disclaimer
follow trust project BeInCrypto is committed to fair and transparent reporting. This news article is designed to provide accurate and timely information. However, readers are advised to independently verify the facts and consult a professional before making any decisions based on the content of this article. Please note that our terms and Conditions, privacy policyand Disclaimer Updated.
