Not a day goes by that is uneventful in crypto. As always, we are here to break down the most important news topics that involve crypto or portfolio management.
The high-frequency trading giant is back in crypto headlines. This time, it’s tied to fresh legal claims around the 2022 Terra collapse. Meanwhile, Bitcoin volatility picks up, Polymarket bettors are placing million-dollar bets on insider trading investigations, and a Trump-linked stablecoin briefly wobbles.
Let’s break it all down.
Jane Street Accused of Accelerating Terraform’s Collapse
Jane Street is facing serious allegations.
Terraform Labs’ bankruptcy administrator, Todd Snyder, has filed a lawsuit accusing the trading firm of using insider information to front-run trades during the May 2022 Terra collapse.
Here’s what allegedly happened:
- Terraform quietly withdrew 150 million UST from Curve’s 3pool on May 7, 2022.
- Within 10 minutes, a wallet linked to Jane Street withdrew 85 million UST.
- The move allegedly accelerated UST’s depeg.
- Panic followed.
- Nearly $40 billion in market value evaporated within days.
Terraform claims Jane Street used material nonpublic information. That means trading on private information before it becomes public. In traditional finance, that’s a major offense.
Jane Street denies everything.
The firm called the lawsuit “desperate” and “baseless,” arguing that Terra’s collapse was the result of internal fraud and structural flaws — not market manipulation.
A Quick Refresher: What Happened to Terra?
Terraform Labs was founded in 2018 by Do Kwon and Daniel Shin.
They created:
- The Terra blockchain
- The LUNA token
- The algorithmic stablecoin TerraUSD (UST)
In May 2022:
- UST lost its 1:1 peg to the dollar
- LUNA hyperinflated
- The ecosystem collapsed
The contagion spread across the industry. Several funds and lenders went under.
Terraform later filed for bankruptcy in January 2024. Do Kwon eventually pleaded guilty and received a 15-year prison sentence.
Now, years later, the legal aftershocks are still unfolding — and Jane Street is in the crosshairs.
Bitcoin Bounces as Jane Street Rumors Swirl
While the lawsuit circulates, Bitcoin volatility is heating up again.
Bitcoin recently bounced above $66,000 after rumors surfaced that Jane Street may have suspended certain algorithmic trading strategies.
Some traders floated a “10am Eastern slam” theory — claiming coordinated algorithmic selling pressure suppressed BTC for months.
Others pushed back, calling it overly simplistic.
Thin order books don’t help. When liquidity is razor thin, small flows can move markets aggressively. That increases volatility in both directions.
Bitcoin is currently trying to reclaim $65K as support.
For now, rumors remain just that — rumors.
But in crypto, narratives move faster than facts.
Before we continue with the drama, let’s talk opportunity.
If you’re farming or just passively holding wallets, you should keep an eye on current claims.
- MetaMask Linea S1 Claim Live
- Based Raises $11.5M — Season 3 Live
- Acurast Claim Live
- Openmind Eligibility Checker Live
And yes — we now have our Airdrop Eligibility Checker live on AirdropAlert.
You can check for free if you missed any claims.
Several users already found over $1,000+ in unclaimed tokens since we launched it Sunday.
If you’ve been active on-chain over the past two years, it’s worth five minutes to check.
Missed airdrops are free money sitting idle.
Polymarket Traders Bet $3M on ZachXBT’s Next Target
Polymarket bettors have placed nearly $3 million on which crypto firm investigator ZachXBT will expose next.
The leading candidate?
Meteora at 43% odds.
Other names include:
I personally put a small bet on Pump.fun.
Why?
Meteora feels too obvious. A lot of the insider activity around Trump-themed memes was already discussed publicly. If ZachXBT pre-announced a “major investigation,” I expect something less predictable.
That said — markets are often right.
Polymarket odds reflect real money conviction. But remember, they reflect speculation — not confirmed evidence.
We’ll see soon.
Trump-Linked Stablecoin USD1 Briefly Depegs
USD1 briefly fell to $0.994, about 0.6% below its peg.
The token is tied to World Liberty Financial and reportedly linked to the Trump family.
Developers claimed:
- Cofounder accounts were hacked
- Influencers were paid to spread fear
- Short positions were opened on WLFI
The peg recovered the same day, returning to $0.998.
This looks more like a panic/liquidity event than structural insolvency.
For perspective:
USDe depegged nearly 30% during a panic event last year — and later stabilized.
A 0.6% wobble is noise in crypto terms.
Keep your head cool.
And don’t react to every “BREAKING” tweet from larpy KOLs farming engagement.
AI Drama: Anthropic Accuses Chinese Labs of Distillation
Outside crypto but still relevant.
Anthropic accused Chinese AI firms of illegally “distilling” its Claude model.
Companies named include:
Anthropic claims:
- 24,000 fake accounts were created
- 16 million interactions were conducted
- Advanced capabilities were replicated
Distillation allows smaller models to learn from more powerful ones. It’s efficient — but controversial if done without permission.
Why this matters for crypto?
AI tokens and infrastructure projects are heavily tied to model innovation. If model IP becomes harder to protect, valuations shift fast.
AI and crypto overlap more than people realize.
Related: Lobstar AI agent accidently send a X begger $270,000 in token.
Macro Signal: “Can’t Sell House” Searches Hit 10-Year High
This is not crypto.
But it matters.
Google searches for “can’t sell house” just hit a decade high.
That tells us liquidity in housing may be tightening.
Higher mortgage rates. Lower affordability. Slower transaction volume.
Housing drives:
- Construction jobs
- Materials demand
- Lending activity
- Consumer spending
When liquidity slows in housing, it eventually touches everything.
Crypto runs on liquidity too.
Keep that in mind.
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The Jane Street lawsuit reopens one of crypto’s most traumatic chapters.
Whether the allegations hold or not, it reminds us of something important:
Liquidity, information flow, and trust drive markets.
When trust cracks, markets collapse fast.
Meanwhile:
- Bitcoin volatility is rising
- Polymarket speculation is heating up
- Stablecoins wobble
- AI battles escalate
- Housing shows stress signals
Markets are interconnected.
Stay informed.
Stay calm.
And check your wallets for missed airdrops — you might be sitting on free money without realizing it.
If you enjoyed this blog, you may want to check our other crypto news updates.
As always, don’t forget to claim your bonus below on Bybit. See you next time!
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