The Wintermute researcher claims there is evidence that Jane Street was the hedge fund that started the LUNA-UST crash.
The head of research at market maker Wintermute questioned that Jane Street investment fund was the name that caused UST to be depeg in early May 2022, starting the rapid collapse of the 60 billion ecosystem. USD LUNA-UST just a few days later.
Many LUNA-UST event summaries regularly refer to the 4pool event – a liquidity pool between USDT and 3 other major stablecoins USDT, USDC and DAI on the Curve Finance protocol. On May 8, 2022, someone dumped 85 million UST into 4pool and then withdrew the rest of the stablecoins, causing UST to be depeg (falling off the $1 mark) and triggering the ensuing crisis.
There has been much speculation about who made the 85 million UST discharge, but no report has been able to give the exact name. This sparked rumors that LUNA-UST was “hacked” in a battle of the “big hands” in the market, leaving untold damage to retail investors.
However, according to Igor Igamberdiev, head of research at Wintermute, that name is “highly likely” to be Jane Street, a little-known but extremely popular hedge fund on Wall Street.
2/7
On May 3, 2022, Clearpool announced that Jane Street borrowed 25M USDC from @BlockTower using their permissioned lending pool
This news made it possible to identify three addresses of the trading firm, of which we are most interested in only onehttps://t.co/mBROglteMD
— Igor Igamberdiev (@FrankResearcher) February 28, 2023
Igamberdiev said he had found evidence linking Jane Street’s DeFi activities in the early days of May, starting with many transactions of borrowing money from BlockTower funds through the Clearpool lending protocol. Notably, the loan amount was sometimes kept in the Coinbase exchange wallet with the amount of 84.5 million USDC that the UST dumper on Curve withdrew, and this is the key for the Wintermute researcher to come to the conclusion that the owner The core of the Coinbase wallet is Jane Street.
4/7
Before receiving $25M from Jane Street, this Coinbase wallet received 84.5M USDC from the UST depegger after the fateful swap
This wallet didn’t have any other interactions other than the two deposits mentioned
Therefore, they are highly likely to belong to the same entity pic.twitter.com/vOz934hlzm
— Igor Igamberdiev (@FrankResearcher) February 28, 2023
Even so, Igor Igamberdiev admits that he has yet to deduce why Jane Street released such a large amount of UST, only to then be rumored to participate in discussions with Terraform Labs about the “rescue.” UST.
Jane Street is an American stock exchange fund, best known on Wall Street. Although not mentioned much in the crypto industry, it is worth noting that former FTX CEO Sam Bankman-Fried, two former CEOs of Alameda Research are Sam Trabucco and Caroline Ellison, and former FTX.US CEO Brett Harrison They both first met while working at Jane Street, then left the hedge fund and founded the “empire” FTX/Alameda.
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