- Jane Street is reportedly halting its trading of physically settled crypto derivatives.
- Both firms are not abandoning the industry entirely.
Market makers Jane Street and Jump Trading are pulling back from their cryptocurrency operations due to increasing market scrutiny by the US, Bloomberg reported Wednesday, citing a person familiar with the matter.
Jane Street is taking a step further – cutting down its crypto prospects in the international markets – over what sources say is due to regulatory uncertainty making it hard for the company to do business in a way that aligns with its internal standards.
Specifically, the New York-based firm is suspending the buying and selling of physically settled crypto derivatives on some US exchanges, a step also taken by Jump Trading. However, according to the information from Bloomberg, both companies are partially halting their crypto operation.
Jane Street And Jump’s Links With TerraUSD
Jane Street and Jump Crypto, the digital assets division of Jump Trading, were recently targeted by the US authorities over the collapse of the Terra USD blockchain project. The scrutiny intensified after the collapse of FTX.
Notably, some employees at Jane Street include disgraced Sam Bankman-Fried, former CEO and founder of FTX, and the CEO of the exchange’s hedge fund Alameda Research Caroline Ellison.
See Related: FTX Co-Founder Pleads Guilty To Fraud Charges; Faces Up To 75 Years In Prison
Jane Street and Jump are not the only crypto companies scaling down operations due to the increasing regulatory tides in the US. Coinbase, who recently received a warning from the SEC of a potential lawsuit, has launched a derivatives platform in Bermuda and is considering establishing an international hub in the UAE.
The other companies facing regulatory hurdles in the US include Binance, the top exchange by trading volume, which was sued by the Commodities Futures Trading Commission (CFTC) for allegedly offering unregistered crypto derivatives in the US contravening federal law.
