Terraform can use Jump documents in $4B case, court trims claims

Terraform Labs creditors may have a clearer path, but not a payout yet. A Delaware bankruptcy judge has allowed the Plan Administrator to use Jump Trading documents in a lawsuit that seeks at least $4 billion, while also rejecting four late crypto-loss claims. For holders tied to the Terra collapse, that changes procedure, not outcome.

In a July 8 order, Judge Brendan L. Shannon said the administrator had violated the protective order as written by using "Jump Reproduced Documents" in the Illinois case. He then changed the order so those documents can be used in that lawsuit, including in an amended complaint, with immediate effect. Questions about removing confidentiality labels were left to the Illinois court.

The lawsuit alleges Jump entered a secret arrangement to support TerraUSD and received $1.5 billion in Bitcoin reserves without written agreements or oversight. Those claims have not been decided. The ruling does not say Jump owes money, and it does not make the documents public.

A separate order denied motions from four people who tried to file crypto-loss claims after the deadline and told claims agent Kroll to update the register. The administrator says about 16,640 crypto-loss claims have been submitted, and reviews are still ongoing. Only allowed claims, not submitted claims, can share in any eventual distribution.