<\/p>\n
Citadel Securities, in response to a court filing from Terraform Labs earlier this month, says it had nothing to do with the 2022 depeg of the stablecoin UST.\u00a0<\/p>\n
In a filing that pushes back against a motion to compel by Terra, Citadel claimed that Terra is attempting to \u201cdeflect\u201d from allegations that it conspired with Jump Trading to \u201cpump up the asset prices.\u201d<\/p>\n
\u201cTerraform uses a motion to compel to pursue a ridiculous conspiracy theory \u2018exposing\u2019 the purportedly hidden role of Citadel Securities in its self-imposed disaster. Not only is the time period of the request irrelevant, but the theory is baseless,\u201d the filing said.<\/p>\n
Terraform<\/a> did not immediately respond to a request for comment.<\/p>\n \u201cIts motion rests on social media, including the account of pseudonymous user \u2018Gigantic Rebirth\u2019 who posted that [Citadel Securities CEO] Ken Griffin divulged his plans over their twice monthly lunch and a \u2018nice bacon rib.\u2019 This, of course, is absurd on its face.\u201d<\/p>\n Citadel<\/a> asked the court to deny Terraform\u2019s motion to compel, alleging that it only ever engaged in \u201ctwo test transactions with a collective value of roughly [$0.13],\u201d and therefore didn\u2019t cause the depeg.<\/p>\n Citadel alleges that it gave Terraform discovery \u201cshowing that it did not meaningfully trade in the relevant cryptocurrencies,\u201d making \u201can exploration of Citadel Securities\u2019 trading strategies particularly unhelpful and irrelevant.\u201d<\/p>\n But Citadel goes further than asking the court to toss the motion from Terraform. It also asks the court to \u201csanction Terraform for its spurious and harassing request\u201d arguing that it complied with the necessary discovery, and the motion to compel was Terra acting in \u201cbad faith.\u201d<\/p>\n If the court pushes forward with sanctions, Terra could be on the hook to pay attorney\u2019s fees and possibly even \u201clost earnings,\u201d though figures of either were not disclosed.<\/p>\n Terraform, on Oct. 12, filed the motion to compel against Citadel Securities<\/a> alleging that social media posts pointed to Citadel Securities as being behind the UST depeg. However, one of the posts mentioned also referred to Citadel\u2019s involvement as a \u201crumor\u201d and another claimed that an anonymous Discord user had lunch with Griffin.<\/p>\n Terraform faces legal action from the US Securities and Exchange Commission over the 2022 depeg. The SEC filed a lawsuit against Terra, and former CEO Do Kwon<\/a> back in February.<\/p>\n Following the Ripple ruling \u2014 which saw a federal judge partially side<\/a> with Ripple \u2014 Terraform tried to use the ruling to dismiss their suit back in July<\/a>.\u00a0<\/p>\n Judge Jed Rakoff, the judge overseeing the case, argued that the token sales<\/a> went toward building the Terraform blockchain and therefore generated profit for all holders. That opinion seemed to be at odds with the partial ruling from Judge Analisa Torres, who is overseeing the Ripple case.<\/p>\n Don\u2019t miss the next big story \u2013 join our\u00a0free daily newsletter<\/a>.<\/strong><\/p>\n
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