Benzinga - The situation surrounding Terraform Labs co-founder Do Kwon has garnered renewed attention. Recent reports have brought to light possible undisclosed interactions between Jump Crypto President Kanav Kariya and Kwon. In light of these developments, Kariya has exercised his Fifth Amendment rights when questioned.
What Happened: Amid the aftermath of TerraUSD's significant financial implosion, which Blockworks reports at a staggering $40 billion, Kariya is now entangled in SEC investigations over purported private agreements with the former Terraform Labs CEO. These events cast a renewed focus on the scrutiny surrounding LUNA and UST, the digital assets at the heart of the crisis.
This news comes on the heels of Benzinga’s Future Of Digital Assets Event in New York scheduled on Nov.14. Attend and learn more about TerraUSD and its collapse impacting the crypto industry. The gathering is seen as pivotal for the digital assets community. The event will spotlight the latest trends, innovations, and challenges in the digital asset realm.
Also Read: Do Kwon, Terraform Labs Tell Court: SEC Hasn't Proven 'Defendants Did Anything Wrong'
Terra researcher FatMan revealed excerpts of Kariya's deposition on social media, showing Kariya's consistent use of the Fifth Amendment in response to the SEC's questions.
During an SEC deposition, Kariya was asked to confirm under oath if there had been any discussions with Do Kwon about financial support for UST's stability, which would involve LUNA transactions.
In a deposition with the SEC, Kanav Kariya from Jump Crypto was directly asked, under oath, whether Jump promised to bail out Do Kwon and restore the UST peg in exchange for a LUNA bribe.SEC inquiries suggest they are examining whether Jump engaged in influencing UST's price and AnchorUST for purported advantages in May 2021.He pled the fifth. pic.twitter.com/5iQK0skk4P
— FatMan (@FatManTerra) November 8, 2023
Background: During a deposition in October 2023, Devon Staren from the SEC questioned Kariya about whether there was an agreement to stabilize UST's value by purchasing the stablecoin in significant volumes in May 2021. Staren also explored the possibility of a reciprocal arrangement, where Kwon would modify Jump’s LUNA loan terms and remove vesting restrictions.
This alleged deal would have permitted Jump to acquire LUNA at a deeply reduced rate, enabling them to influence UST's market price favorably. Jump Crypto secured LUNA tokens at $0.40 each, a stark contrast to the prevailing $90 market price.
As a prominent player in the Terra ecosystem, Jump Crypto engaged in governance and invested in the network's cross-chain bridge, according to Unchained Crypto. Kariya held a position on the board of the Luna Foundation Guard, which managed Terra’s reserves.
In early 2023, reports surfaced suggesting Jump as the trading firm implicated in the SEC's charges against Terraform Labs and Kwon. Prior to the Terra crisis, Jump reportedly profited over $1 billion from a confidential agreement.
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Now Read: Crypto's Most Wanted: Terra Co-Founder Arrested, Partner Indicted, Billions Frozen
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