Fracture Labs Sues Jump Trading Over Alleged ‘Pump and Dump’ Scheme
Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...
Crypto game developer Fracture Labs has filed a lawsuit against Jump Trading, alleging that the firm manipulated its DIO gaming token through a “pump and dump” scheme.
The suit, submitted on October 15 in an Illinois District Court, details Fracture Labs’ claim that Jump Trading, acting as a market maker, breached its agreement to support the DIO token’s initial offering on the crypto exchange HTX (formerly Huobi) in 2021.
Fracture Labs asserts that it provided Jump Trading with 10 million DIO tokens, valued at $500,000, to facilitate the token’s launch.
Additionally, 6 million DIO tokens, worth approximately $300,000, were transferred to HTX.
Following the launch, HTX engaged online influencers to promote DIO, driving its value up to $0.98.
At this peak, the tokens Jump held were reportedly valued at $9.8 million.
However, Fracture Labs claims that Jump then sold its entire DIO holdings, leading to a “mass liquidation” that saw the token’s price plummet to $0.005.
The lawsuit alleges that Jump profited millions from this maneuver, subsequently buying back the tokens at the reduced value of around $53,000.
The tokens were then returned to Fracture Labs, effectively ending the partnership.
According to the complaint, Jump’s actions severely devalued DIO, making it challenging for Fracture Labs to secure further investment and interest in its platform.
The developer alleges that this move was a breach of trust and a deliberate attempt to manipulate the market for profit.
In addition, Fracture Labs states it transferred 1.5 million
Read more on cryptonews.com
