Terraform Labs Pte. Ltd. (Movant), has filed a motion to compel market maker Citadel Securities, LLC to divulge crucial trading data. This data, pertinent to a third-party subpoena, is deemed critical for Terraform Labs’ defense against a lawsuit initiated by the U.S. Securities and Exchange Commission (SEC). The lawsuit, presided over by the U.S. District Court for the Southern District of New York, delves into allegations of market destabilization due to purported intentional actions by certain market players to “short” and consequently cause the TerraUSD (UST) stablecoin to depeg from its $1 benchmark.
Disputing the SEC’s allegations, Terraform Labs argues that the market instability did not stem from the algorithm underpinning UST but was a result of orchestrated efforts by third-party market participants to manipulate the stablecoin’s value. The significant focus is on the trading activities around the May 2022 Depeg event,…
