Terraform Labs Has Accused Citadel’s Ken Griffin of Intentionally Shorting UST 

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Terraform Labs has made serious accusations against Ken Griffin, the head of Citadel Securities, suggesting their potential role in de-pegging TerraUSD (UST). The move involves a legal action to compel Citadel Securities to provide critical data linked to this incident.

Terraform Claimed that Citadel’s Ken Griffin Short UST Intentionally

Terraform Labs, the company behind Terra (LUNA) and TerraUSD (UST), has dropped a legal bombshell. They’re saying that a giant trading company, Citadel Securities, had a hand in making their digital cash, UST, lose value. 

On October 10, Terraform Labs filed a legal request in a court in Florida. They’re asking the court to make Citadel share their trading data from when UST lost its fixed value in May 2022.

Terraform has narrowed down its demands from Citadel to focus on critical trading data during this specific period, which they believe is crucial for their defense in the lawsuit brought forward by the US Securities and Exchange Commission (SEC). However, Citadel has only handed over a single document, refusing to share the rest.

Meanwhile, the bombshell doesn’t stop there. Terraform points to publicly available evidence suggesting that Ken Griffin intended to short UST during the de-pegging event. They mention discussions on platforms like Discord and data from blockchain research firm Nansen, detailing an attack on UST by well-funded traders.

In their legal action, Terraform also pointed to public information suggesting that Ken Griffin, Citadel Entities’ head, might have tried to short UST when it was de-pegging. They found this info in open discussions and from a blockchain research firm called Nansen. 

Terraform alleges that these third-party market participants intentionally destabilized the market to cause UST to depress from its one-dollar price.

Denial of Alligation by Citadel 

Citadel had previously denied rumors about their involvement in stablecoin trading, emphasizing they do not trade stablecoins, including UST. They said this on a public platform back in May 2022.

The Southern District of Florida has yet to respond to the filing from October 10. Terraform has requested a transfer of the filing to the Southern District of New York, where the SEC’s case is based, to have Judge Jed Rakoff oversee the motion.

Additionally, Terraform is also seeking documents from the bankrupt crypto exchange FTX to defend against a lawsuit from the U.S. Securities and Exchange Commission, which alleges the firm orchestrated a multi-billion dollar crypto fraud.