With a troubled past, Jump fully resumes its cryptocurrency operations, facing an awkward situation.

Original Article Title: "Tainted by Dark History, Jump Fully Restores Crypto Business Facing Awkward Situation"

Original Article Author: Nianqing, ChainCatcher

In August last year, Jump Trading's sudden and massive sell-off plunged the crypto market into the abyss, further triggering the "805 Crash." At that time, rumors about Jump, "the big guy," going down became increasingly intense.

Over the following six months, almost all of the few news stories about Jump revolved around its internal and external litigations and lawsuits.

Recently, CoinDesk cited sources familiar with the matter reporting that Jump is currently in the process of fully restoring its cryptocurrency business. The Jump Trading website shows that Jump is hiring a group of cryptocurrency engineers for its offices in Chicago, Sydney, Singapore, and London. In addition, another source added that Jump plans to start filling U.S. policy and government liaison positions at the appropriate time.

Jump was once referred to as the "undisputed king" of trading. With its ultra-low-latency trading system and sophisticated algorithm design, Jump has been a key liquidity provider in traditional finance. As the crypto market has continued to expand, Jump began market-making for cryptocurrencies, invested in crypto projects, and formally established the crypto business division Jump Crypto in 2021.

However, a gamble that accompanied the birth of Jump Crypto also sowed the seeds of its later tragedy.

Jump Trading Rise and Fall: The Cryptic Gamble of a Secretive Giant

In the early days, traders in trading pits used shouting, hand signals, and jumping to openly bid prices. This was also the inspiration for Jump Trading's name.

Headquartered in Chicago, Jump Trading was founded in 1999 by two former Chicago Mercantile Exchange (CME) floor traders, Bill DiSomma and Paul Gurinas. Jump quickly grew into one of the world's largest high-frequency trading firms, active on futures, options, and securities exchanges worldwide, as well as a major trader in U.S. Treasuries and cryptocurrencies.

For protection of trading strategies, Jump has always maintained a low profile, and as market makers have always operated in the shadows, a layer of mystery has always surrounded them. Jump rarely discloses its financial data, and the founders have always remained tight-lipped about its operations. Since 2020, perhaps to reduce exposure, after a strategy adjustment and business restructuring, Jump no longer needs to submit the 13F filings to the SEC but rather continues to do so through its parent company, Jump Financial LLC. The latest 13F filings submitted by the latter show that Jump Financial's AUM exceeds $7.6 billion, with approximately 1600 employees. Additionally, Jump Trading has offices in the U.S., Europe, Australia, and Asia.

Jump Trading has two subsidiary business units, namely Jump Capital and Jump Crypto.

Jump Capital

Jump Capital, headquartered in Chicago, was founded in 2012. Although Jump's crypto division was officially established in 2021, Jump Capital has been involved in crypto investments early on. One of its partners and head of crypto strategy, Peter Johnson, revealed that the company has been stealthily deploying crypto strategies for years.

According to relevant RootData pages, Jump Capital's crypto investment portfolio has exceeded 80 projects, focusing mainly on DeFi, infrastructure, and CeFi, with investments in projects such as loTeX, Sei, Galxe, Mantle, and Phantom.

In July 2021, Jump launched its largest fund to date with a total capital commitment of $350 million, attracting 167 investors. This marks Jump Capital's 7th venture fund.

Jump Crypto

In 2021, alongside the completion of its seventh fundraising for the investment fund, Jump announced the formation of the crypto investment division, Jump Crypto. 40% of the seventh investment fund was allocated to the cryptocurrency space, focusing on stocks, tokens, and projects in DeFi, financial applications, blockchain infrastructure, and Web 3.0.

At only 26 years old, Kanav Kariya was appointed as the inaugural President of Jump Crypto in 2021. Kariya joined Jump Trading as an intern in early 2017 and was tasked with building the early-stage cryptocurrency trading infrastructure.

Related Reading: "Digging Deep into Jump's History: Intern to President in 4 Months"

In May 2021, Terra's algorithmic stablecoin UST first experienced a depegging incident. Over the following week, Jump secretly purchased a large amount of UST to create the illusion of demand and restore UST's value to $1. This trade earned Jump $1 billion, and Kanav Kariya, the mastermind behind the scheme, rapidly ascended to President of Jump Crypto four months later.

However, this secret transaction also laid the groundwork for Jump's fall from grace.

With the complete collapse of the Terra UST stablecoin in 2022, Jump faced criminal charges of price manipulation in collusion with Terra. In the same year, Jump suffered significant losses in the FTX bankruptcy due to its deep integration with the FTX and Solana ecosystems.

Following the FTX incident, the United States tightened its regulation of the crypto market, and Jump Trading was reportedly forced to downsize its operations and gradually withdraw from the U.S. crypto market. For example, after the FTX incident, Robinhood ended its partnership with Jump. Jump Crypto's subsidiary, Tai Mo Shan, was once Robinhood's largest market maker, responsible for handling Robinhood's daily volume of billions of dollars. However, since the fourth quarter of 2022, Robinhood's financial reports no longer mention Tai Mo Shan, and Robinhood has instead partnered with market makers like B2C2.

Furthermore, to reduce its cryptocurrency business, in November 2023, Jump Crypto officially spun off Wormhole. Key personnel, including Wormhole's CEO and COO, left Jump Crypto. The Jump Crypto team was also nearly halved during this period.

Jump Crypto's investment activities significantly decreased after 2023. According to RootData, Jump Crypto's crypto portfolio had exceeded 90 projects, mainly investing in infrastructure and DeFi, with investments in projects such as Aptos, Sui, Celestia, Injective, NEAR, and Kucoin. However, its "Number of deals in the past year" was only in single digits.

On June 20, 2024, according to Fortune, the U.S. Commodity Futures Trading Commission (CFTC) was investigating Jump Crypto. A few days later, Kanav Kariya, who had served at Jump Trading for six years, announced his resignation.

A month later, Jump Crypto initiated a large-scale ETH sell-off. Within 10 days, Jump Crypto had sold ETH worth over $300 million, and the panic directly caused a market downturn on August 5, 2024, with Ethereum experiencing a single-day decline of over 25%. The community speculated that Jump Crypto's ETH sell-off might have been due to pressure from the CFTC investigation, in exchange for stablecoins to facilitate a timely exit from the cryptocurrency business. Jump Crypto was rumored to be "the big guy on the brink of collapse."

Related Reading: "Accused of Crashing the Market, Uncovering Crypto Market Maker Jump Crypto"

In December 2024, Jump Crypto's subsidiary Tai Mo Shan agreed to pay approximately $123 million to settle with the U.S. SEC. According to later SEC enforcement filings, Tai Mo Shan was involved in the Terra UST market making that year. Tai Mo Shan is reportedly domiciled in the Cayman Islands and was established to handle specific market making and cryptocurrency trading business.

After over three years of painful entanglement, Jump's and Terra's event seems to have finally settled.

Jump Fully Restores Crypto Business: The Return of the King or a Long Way Back?

Why did Jump choose this time to fully restore its crypto business?

In addition to Jump's legal resolution in the Terra event, a more crucial reason is the Trump administration's friendly stance towards cryptocurrencies.

Just two days ago, on March 5th, Jump's long-time rival DRW's crypto arm Cumberland DRW signed a joint application with the U.S. Securities and Exchange Commission (SEC) seeking to dismiss the SEC's lawsuit against them. The agreement was preliminarily reached by the parties on February 20th and is currently awaiting approval by the SEC Commission. The SEC sued Cumberland DRW in October of last year, accusing them of operating as an unregistered securities dealer and selling over $2 billion in unregistered securities.

The SEC's new leadership team has adopted a more tolerant regulatory approach towards crypto companies, a stance that has given Jump hope for a resurgence. Furthermore, the potential approval of spot ETFs for altcoins like Solana this year has motivated Jump Crypto, deeply involved in the Solana ecosystem, to seek a piece of the pie.

By the end of 2023, Jump had negotiated with BlackRock on "market-making for a Bitcoin spot ETF," but perhaps due to regulatory concerns, Jump Crypto ultimately did not participate in Bitcoin or even later Ethereum spot ETF market making.

Jump Still Has the Strength to Make a Comeback

A lean camel is greater than a dead horse. Jump Trading still holds around $677 million in on-chain assets, with Solana tokens accounting for nearly half at 47%, holding 2.175 million SOL. Stablecoins account for about 30%.

Source: ARKHAM

Jump Trading's on-chain fund size remains one of the largest among several crypto market makers. As of March 8, 2025, when comparing Jump's fund balance with other market makers, the ranking from high to low is as follows:

1. Jump Trading: $677 million

2. Wintermute: $594 million

3. QCP Capital: $128 million

4. GSR Markets: $96 million

5. B2C2 Group: $82 million

6. Cumberland DRW: $65 million

7. Amber Group: $20 million

8. DWF Labs: $10 million

In addition to fund size, Jump also boasts a series of technical advantages. Taking deep involvement in the Solana ecosystem as an example, Jump is currently engaged in the Solana ecosystem through various forms such as technical development (developing the Firedancer validation client, providing technical support for Pyth Network, Wormhole), investments (Jump has invested in multiple Solana ecosystem projects), market making, etc. The sample provided by Jump to the Solana ecosystem construction may bring more cooperation opportunities.

However, from another perspective, Solana's decentralization has been weakened by Jump's dominant position.

A Checkered Past, Jump Fearful of Sinking

Jump has a halo, but it also has a checkered past.

The UST incident in Terra clearly shows that Jump Crypto's market-making style in the crypto market is extremely aggressive. Although the market maker's visible income comes from the spread earned from trades, collaborating with project teams to pump prices for options and other massive revenues is not uncommon in the crypto industry.

In the traditional financial industry, market making is a strictly regulated business, and oversight needs to ensure there are no conflicts of interest. Market makers do not directly cooperate with the company issuing the stock but operate with trading platforms under regulatory supervision. Market making and other businesses such as venture capital are usually physically separated to avoid any possibility of insider trading or market manipulation.

A researcher once accused Jump of colluding with Alameda to inflate Serum's fully diluted valuation for a rug pull, but the matter was quickly swept under the rug. Additionally, in October last year, video game developer FractureLabs filed a lawsuit against Jump Trading in the U.S. District Court in Chicago, accusing it of fraudulent and deceptive practices through manipulating the price of the DIO token. FractureLabs had planned to debut the DIO token to raise funds on the Huobi (now renamed HTX) exchange in 2021.

The company engaged Jump Trading as the market maker for DIO and lent 10 million tokens to its subsidiary, while sending 6 million to HTX for the launch. However, Jump Trading systematically liquidated the DIO holdings, causing the token price to plummet to around $0.005, pocketing millions of dollars in profit. Subsequently, Jump repurchased approximately $53,000 worth of tokens at a significant discount and returned them to FractureLabs, after which the market-maker agreement was terminated. Currently, there have been no further developments in this lawsuit.

Although departments like Jump Crypto and Jump Trading appear independent on the surface, in practice, there are clear business ties between these departments. The inability to distinguish between market-making venture activities and trading activities, coupled with the lack of clear regulation in the crypto industry, to some extent, is not a specific market maker's style but a common practice among market makers in the industry, such as the former Alameda and today's DWF. In traditional finance, market-making is heavily regulated, and market makers do not directly collaborate with companies issuing stocks but work with trading platforms under regulatory oversight. To prevent insider trading or market manipulation, there is often a physical separation between market-making and venture capital, among other different businesses.

Yesterday, a GPS token liquidity provider caused a token price crash on a trading platform due to one-sided liquidity addition, bringing the market maker's style and ethical boundaries back into discussion. @Mirror Tang believes that market makers and project teams together constitute a shadow banking system. Project teams usually provide funding to market makers through unsecured loan credit lines, and market makers leverage this funding to provide liquidity, thus enhancing market liquidity. During a bull market, this system can generate huge profits, but it can easily trigger a liquidity crisis during a bear market.

It is currently uncertain whether Jump will resume its cryptocurrency market-making business. However, if the crypto community still remembers, perhaps caution should be exercised regarding Jump's new market-making projects.

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