Jane Street Lawsuit Fuels Late Double-Digit Pop in Terra Luna Classic
Analysis
Price Impact
HighThe lawsuit against jane street, alleging misuse of non-public information that contributed to terra's collapse, has directly catalyzed a nearly 30% price increase in lunc over two weeks. this legal narrative is proving to be a significant driver of price action, overshadowing fundamentals.
Trustworthiness
MediumThe trustworthiness is medium because the price movement is primarily driven by a legal narrative and speculation about potential compensation or shifted market perception. while there's a short-term rally, the ultimate legal outcome is uncertain, and setbacks could reverse the gains. the short squeeze dynamics add another layer of volatility.
Price Direction
BullishThe price is currently bullish due to the lawsuit news, a significant price surge, and indicators like increased open interest and a futures' cumulative volume delta suggesting a short squeeze. if spot buying continues, the rally could extend.
Time Effect
ShortThe current bullish momentum appears to be short-term, driven by immediate reaction to the lawsuit filing and short-squeeze dynamics. the long-term price direction remains highly dependent on the progression and outcome of the legal proceedings.
Original Article:
Article Content:
In brief Terra Luna Classic (LUNC) has jumped double digits on the day, up nearly 30% over the past two weeks. Open interest jumped from $100M to $160M as futures CVD signaled short-squeeze dynamics. Bitget's Lee says the legal narrative, not fundamentals, is driving renewed market attention. Terra Luna Classic (LUNC) has jumped double-digits over the past day, in a late reaction to this week’s lawsuit filed by Terraform Labs' bankruptcy administrator against trading firm Jane Street. LUNC surged 15.5% over the past 24 hours and is up nearly 30% over the past two weeks, according to CoinGecko data . The sudden uptick was driven by spot buyers, with derivatives data showing open interest climbing from $100 million to $160 million, per Velo data. As the rally accelerated, futures' cumulative volume delta plummeted—a signature sign of a short squeeze in play. The move has “thrust one of crypto's most infamous collapses back into the spotlight,” Ryan Lee, chief analyst at Bitget, told Decrypt , with traders betting that legal developments could shift market perception or potentially unlock value for legacy holders. The Jane Street lawsuit The catalyst traces back to Monday, when Terraform Labs' bankruptcy administrator filed a federal lawsuit in Manhattan alleging that Jane Street used non-public information to execute profitable trades that accelerated the historic 2022 collapse of TerraUSD and LUNA. The lawsuit claims the trading contributed to approximately $40 billion in losses. The legal narrative has galvanized interest in LUNC, Lee said, adding that it has “reignited trader sentiment around accountability and potential compensation.” He noted that some traders are positioning on the belief that positive developments in the case could shift market perception or unlock value for legacy holders. “Headlines about alleged insider trading and renewed scrutiny of one of the sector's largest historic losses have been correlated with short-term spikes in trading activity and price interest,” Lee said. If spot-buying activity continues without the price dropping, the rally has a good chance of extending higher. However, Lee cautioned that the ultimate legal outcome remains uncertain. “If the lawsuit progresses or generates clarity, it may continue to influence sentiment,” he added. “Conversely, any setbacks or dismissals could temper enthusiasm and re-expose LUNC to broader macro pressures.” LUNC’s jump comes amid a broader crypto market bounce that has brushed off pessimism among traders—at least in the short-term. Users on prediction market Myriad , owned by Decrypt’s parent company Dastan, put a 42% chance on Bitcoin rallying to $84,000 rather than dumping to $55,000, up from lows of 27% on Tuesday. Daily Debrief Newsletter Start every day with the top news stories right now, plus original features, a podcast, videos and more. Your Email Get it! Get it!