Jane Street, Jump Pull Back Crypto Trading Over US Regulatory Uncertainty

Jane Street Group and Jump Crypto — two of the world’s top market-making firms — are pulling back from trading digital assets in the US as regulators crack down on the industry.

Jane Street is going even further by scaling back its crypto ambitions globally because regulatory uncertainty has made it difficult for the firm to operate the business in a way that meets internal standards, according to a person familiar with the matter.

Jump Crypto, the digital-assets unit of Jump Trading, is pulling back from the US market for the same reason, though it’s expanding internationally, two people familiar with the matter said. Both firms are still making markets, though on a smaller scale, and not abandoning crypto entirely, the people said.

Scrutiny of the digital-asset industry has intensified following the collapse of high-profile firms and projects, including FTX, the crypto exchange founded by Sam Bankman-Fried, and TerraUSD stablecoin.

Jane Street and Jump Trading were caught up in some of the turmoil, and were among trading firms questioned by US prosecutors in a probe of the failed TerraUSD stablecoin project. Jump Crypto had been a major backer of the TerraUSD project since 2019. No one has been accused of wrongdoing, and inquiries don’t necessarily mean that charges will be brought.

Jane Street was also among the three US quant-trading firms cited anonymously by the Commodity Futures Trading Commission in its lawsuit against Binance Holdings Ltd. as examples of how US-headquartered clients were able to access the platform despite Binance’s promises to exclude them. The regulator also didn’t accuse the trading firms of wrongdoing.

(Source: Bloomberg)