Jump Trading

Jump Trading LLC is a proprietary trading firm with a focus on algorithmic and high-frequency trading strategies. The firm has over 700 employees in Chicago, New York, Austin, London, Tel Aviv, Singapore, Shanghai, Bristol, Gurgaon, Gandhinagar, Sydney, Amsterdam, Hong Kong, and Paris and is active in futures, options, cryptocurrency, and equities markets worldwide.[1]

Jump Trading
TypePrivate
Founded1999
HeadquartersChicago, Illinois, US
Key people
Bill Disomma, Paul Gurinas
ProductsProprietary Trading
Number of employees
700+
Websitewww.jumptrading.com

The company is a member of the Principal Traders Group, an advisory group formed by the Futures Industry Association (FIA) to represent principal traders (i.e. independent proprietary trading firms that trade only on their own accounts).[2]

Jump has been privately funded throughout its existence.[3]

History

Jump Trading was founded in 1999 by two former pit traders, Paul Gurinas and Bill Disomma, who met in the Deutsche Mark pit at the Chicago Mercantile Exchange (CME). While the firm got its start in the open outcry pits, Jump Trading does most of its trading electronically.[4]

The company has made substantial investments in high-frequency trading and infrastructure, including a Belgian microwave tower once owned by NATO, purchased in 2013 by a U.K. affiliate.[5]

Following the 2010 flash crash, Disomma, Gurinas, and COO Matt Schrecengost met with CFTC chairman Gary Gensler to discuss the definition of spoofing as a disruptive trade practice as well as transparency and access to SEFs. This meeting contributed to regulatory efforts to implement new market rules stemming from the Dodd–Frank Act.[6]

In April 2014, Jump was one of six high-speed trading firms subpoenaed by New York Attorney General Eric Schneiderman regarding their trading strategies, as well as the special arrangements they may have with exchanges and dark pools.[7]

In May 2018, Jump was fined $250,000 by the Securities and Exchange Commission (SEC) due to a malfunction in one of its trading algorithms leading to the accidental accumulation of a short position worth hundreds of millions of dollars.[8]

Gurinas and DiSomma also founded a venture capital firm, Jump Capital, in June 2012. By January 2016, the firm had invested in 30 companies. Jump Capital also invested $5 million in The Small Exchange in May 2019, a start-up retail trading futures exchange.[9][10]

Jump Trading is a registered broker-dealer and member of multiple exchanges including the CME Group and the New York Stock Exchange.[11][12] They are also members of most European exchanges including Eurex and the London Stock Exchange.[13][14]

In September 2021, Jump announced their cryptocurrency business through a new brand named Jump Crypto.[15][16]

Lawsuit

On May 9, 2023, a class action suit was filed against Jump Trading and the President of Jump Crypto, Forbes 30 under 30 alumni Kanav Kariya,[17] for violations of the Commodity Exchange Act, CFTC Regulations, and unjust enrichment. The lawsuit alleges Jump Trading participated in market manipulation of the stable coin UST and aided and abetted Do Kwon, alleging, "Jump had made over $1.28 billion in profits from selling the LUNA tokens it received at a steep discount in exchange for artificially propping up the price of UST and aUST."[18]

The lawsuit alleges Jump Trading used their acquisition of the wormhole bridge and investment in the Solana blockchain to artificially compel growth, as UST was one of limited stable coins offered in this ecosystem and Solana is a predominantly centralized protocol promoted to developers by Silicon Valley investors, trading in the near perfect fibonacci ratios characteristic to a16z backed companies.

Charitable work

In 2013, Jump Trading donated $25 million to fund the creation of the OSF HealthCare Jump Trading Simulation and Education Center.

In February 2014, Jump Trading donated an additional $25 million to fund a joint medical research project between OSF HealthCare and the University of Illinois at Urbana-Champaign's College of Engineering. In a statement from the institutions, the donation will support doctors and engineers working together on clinical simulation, education and health care issues striving to "improve the quality of care and outcomes for patients" and "reduce health care costs".[19]

References
  1. "High-Speed Traders Said to Be Subpoenaed in N.Y. Probe". Bloomberg.com. Bloomberg. April 21, 2014.
  2. "High-Frequency Traders Get A New Name". Forbes. August 17, 2010.
  3. "Open Positions". Jump Trading. December 14, 2016.
  4. "It's Not The Pits". Forbes. December 17, 2009.
  5. "Wall Street Grabs NATO Towers in Traders' Speed-of-Light Quest". Bloomberg. July 16, 2014.
  6. "External Meetings: Meeting at Jump Trading".
  7. "NY attorney-general subpoenas high-frequency traders". FT.com. April 21, 2014.
  8. "Jump Trading Order" (PDF).
  9. "Why Chicago's best traders are moving into venture capital". Crain's Chicago Business. August 16, 2016.
  10. "The Small Exchange Raises $10 Million from Citadel Securities and Jump Capital in New Strategic Financing Round". Press Release. May 17, 2019.
  11. "LME Members".
  12. "Don't Tell Anybody About This Story on HFT Power Jump Trading". Bloomberg. July 23, 2014.
  13. "Staff costs weigh on Jump's UK profits". Financial News. July 16, 2014.
  14. "Nasdaq Stockholm Jump Trading" (Press release). December 17, 2018.
  15. "Jump Trading Group Launches Jump Crypto". businesswire.com. businesswire. September 14, 2021.
  16. "Jump Names 25-Year-Old Former Intern as Crypto Unit Head". Bloomberg.com. Bloomberg. September 14, 2021.
  17. "Kanav Kariya". Forbes. Retrieved May 17, 2023.
  18. https://www.rgrdlaw.com/media/cases/1007_UST%20-%20Jump%20Trading%20File-Stamped%20Complaint.pdf
  19. "Jump Trading gives $25 million to medical research project". Crain's Chicago Business. March 4, 2014.


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