Lawsuit alleges insider trading during 2022 Terra collapse, spotlighting crypto market manipulation risks.

In February 2026, Terraform’s wind-down trust sued Jane Street for alleged insider trading during the May 2022 TerraUSD collapse, accusing the firm of using nonpublic information to exit positions and manipulate the market. The lawsuit, filed in Manhattan federal court, invokes traditional securities laws, marking a rare application of these rules to crypto market-making. This case highlights concerns over transparency and fairness in crypto liquidity provision and could influence tighter regulatory standards. Binance has already updated its market-maker rules, reflecting growing industry scrutiny. Investors should watch the case's progress and potential regulatory impact on crypto trading practices.