Wall Street trading powerhouse Jane Street is currently facing a dual-front legal battle, with high-stakes allegations of market manipulation and insider trading spanning from New York to Mumbai. These developments come as the firm continues to defend its role in some of the most volatile market events of the last several years. In a lawsuit filed on February 23, 2026, the administrator for the Terraform Labs estate accused Jane Street of using "material non-public information" to profit from the 2022 collapse of the TerraUSD (UST) and Luna ecosystem. The collapse originally erased an estimated 40 billion dollars in market value. The legal complaint highlights a critical window on May 7, 2022. Within 10 minutes of Terraform Labs withdrawing 150 million UST from a liquidity pool, a wallet allegedly linked to Jane Street withdrew 85 million UST from that same pool. This move is characterized as a turning point that triggered the final market panic. Jane Street has formally denied the claims, describing them as a "desperate and transparent attempt to extract money." The firm maintains that the catastrophic losses were the direct result of a multibillion-dollar fraud orchestrated by Terraform Labs’ own management. This litigation follows the sentencing of Terraform co-founder Do Kwon, who is currently serving a 15-year prison sentence in the United States. Kwon pleaded guilty to charges of wire fraud and conspiracy after his 2024 extradition. His crimes were described by federal judges as "fraud of an epic generational scale." Simultaneously, Jane Street is embroiled in a significant dispute with the Securities and Exchange Board of India (SEBI). On February 25, 2026, the Securities Appellate Tribunal (SAT) adjourned a hearing regarding a 580 million dollar (4,844 crore rupees) fine and temporary trading ban imposed on the firm. SEBI alleges that Jane Street engaged in a "pump-and-dump" scheme involving the Bank Nifty Index between early 2023 and March 2025. The regulator claims the firm used high-frequency algorithms to push the index up by 1% to 1.3% on derivative expiry dates to capture illicit profits. To resume operations in the Indian market, Jane Street deposited the full 580 million dollar amount into an escrow account. The firm continues to challenge the findings, arguing it was an "index arbitrage" strategy and that it was denied access to critical regulatory documents during the investigation. The broader cryptocurrency market has reacted sharply to these legal pressures. Following the news, market analysts noted a pause in what traders call the "10 a.m. dump"—a pattern of heavy selling often attributed to large algorithmic players. Despite the legal uncertainty, Bitcoin remains volatile, recently testing support levels near 63,000 dollars while attempting to reclaim the 70,000 dollar psychological barrier.