President of Jump Crypto steps down

Kanav Kariya, the head of Jump Trading’s digital asset subsidiary, announced he is stepping down from his role as the president of Jump Crypto amid widespread reports of a Commodity Futures Trading Commission (CFTC) investigation. 

In a June 24 social media post, the now-former president of the crypto trading firm wrote that he intends to focus on personal relationships and reading while he searches for his next venture. Kariya also reflected on the last several years at Jump Crypto, which he characterized as “eventful.”

Jump Crypto's "eventful" years

Jump Crypto’s troubles began in February 2022 when hackers exploited the Wormhole bridge and fraudulently minted 120,000 wrapped Ethereum tokens (wETH), which were then redeemed for Ether ( ETH ) and other tokens on the Solana blockchain. Following the incident, Jump Crypto, which owned the developer behind the Wormhole bridge, assumed responsibility for the damages by depositing an equal number of Ether tokens, valued at $321 million at the time of the hack, into the bridge.

Related: Crypto Super PAC raises $169M following $10M donation from Jump Crypto .

In May 2022, the infamous collapse of the Terra ecosystem impacted the trading firm,  spawning an investor lawsuit alleging that Jump Crypto reaped $1.3 billion in profits by coordinating with Terra founder Do Kwon to manipulate the price of Terra’s UST, with the goal of maintaining the algorithmic stablecoin's U.S. dollar peg. The lawsuit also alleged that Jump Crypto benefited from receiving LUNA tokens at a steep discount, sometimes at a 99% markdown from the market price as a reward for propping up UST and the Terra ecosystem.

Later that same year, concerns surrounding Jump Crypto’s  exposure to FTX began to surface. At the time, company spokespeople assuaged investor fears, explaining that the trading firm was "one of the most well-capitalized and liquid firms in crypto" while reassuring the public that Jump Crypto was not shutting down.

The CFTC investigation

Though the exact scope of the pending CFTC investigation into Jump Crypto has not yet been revealed, the probe may encompass the trading activities raised in the investor lawsuit and cited as part of the Securities and Exchange Commission’s case against Terraform Labs.

It is important to note that the CFTC investigation into Jump Crypto is not an indication of guilt or wrongdoing as the regulator has yet to many any findings.

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