Tai Mo Shan Ltd. Settles With SEC Over TerraUSD Misleading Claims

According to Foresight News, Tai Mo Shan Ltd., the cryptocurrency division of Jump Trading, has agreed to pay $123 million to settle allegations by U.S. regulators that it misled investors about the stability of the TerraUSD algorithmic stablecoin. The U.S. Securities and Exchange Commission (SEC) announced on Friday that the company also resolved accusations of violating securities laws while underwriting TerraUSD's sister token, Luna. Tai Mo Shan neither admitted nor denied the SEC's allegations as part of the settlement. TerraUSD was designed to maintain a constant value of $1 through a complex algorithm involving Luna and trader incentives. However, the SEC stated that Tai Mo Shan's substantial purchasing activities artificially stabilized the coin, misleading the market into believing the algorithmic mechanism was effective.