Tai Mo Shan Ltd., a subsidiary of Jump Trading, has agreed to pay $123 million to settle allegations by U.S. regulators that it misled investors about the stability of its TerraUSD algorithmic stablecoin, Foresight News reported.
The company also settled allegations that it violated securities laws in underwriting Luna, a sister token to TerraUSD, the SEC said. Tai Mo Shan did not admit or deny the allegations in the settlement.
TerraUSD was supposed to maintain its value of $1 through Luna’s algorithm and incentives. The SEC said Tai Mo Shan’s massive purchases stabilized the coin and misled the market into believing the algorithm was effective.
