Yesterday, we already touched on Jane Street and its alleged role in the Terra collapse.
Today, we go deeper.
Because the real question isn’t just about 2022.
It’s about 2025.
And maybe… right now.
Bitcoin Felt Weird This Cycle
Let’s be honest.
This cycle didn’t feel normal.
On my personal Twitter, I’ve sarcastically posted about this for almost a year. Almost every single day when the New York market opened, Bitcoin dropped.
Clock hits 10AM Eastern.
Bitcoin dumps.
Again. And again.
And again.
Even when we made new all-time highs, it felt off.
We made five or six new ATHs in 2025. But each one was tiny. Maybe 1% higher. Then an immediate pullback. No euphoria. Definitely no “god candle.” And no FOMO wave.
In previous cycles, when Bitcoin broke an ATH, it exploded. Shorts got obliterated. Retail rushed in. Momentum fed on itself.
This time?
Every breakout felt trapped.
I assumed ETFs changed the structure. More paper trading. More institutional hedging. Bigger players who understand how to short volatility and trap retail.
But what if it wasn’t “the market”?
What if it was one player?
And here’s the interesting part.
Ever since Jane Street got sued, Bitcoin started moving differently during NY hours.
Coincidence?
Let’s unpack it.
Starting in late 2024 and accelerating through 2025, traders began noticing something strange.
Every trading day around 10AM Eastern — the U.S. stock market open — Bitcoin experienced sharp, mechanical sell-offs.
Not organic volatility.
Precise.
Algorithmic.
These moves:
- Wiped out leveraged longs
- Triggered cascading liquidations
- Recovered hours later
- Repeated almost daily
The timing was too clean to ignore.
Charts showed sudden multi-thousand-dollar drops within minutes of the open. Then stabilization. Then recovery.
It felt manufactured.
And when you look at who sits at the center of ETF liquidity infrastructure, one name keeps appearing:
Jane Street
The federal lawsuit filed by the bankruptcy administrator of Terraform Labs alleges insider-driven trading through a private chat channel described as “Bryce’s Secret.”
The key figure?
Bryce Pratt.
He worked at Terraform. Then joined Jane Street.
According to filings, Terraform withdrew $150M in UST from Curve’s liquidity pool on May 7, 2022. Within ten minutes, a wallet linked to Jane Street withdrew $85M from the same pool.
The result?
UST depegged.
LUNA hyperinflated.
Roughly $40B in value evaporated.
Jane Street denies the allegations and calls the lawsuit baseless. Meanwhile, Do Kwon is serving a 15-year sentence.
But the lawsuit raises an uncomfortable possibility:
If insider access influenced Terra’s collapse… could similar structural advantages influence Bitcoin?
In Q4 2025, Jane Street disclosed holding over 20 million shares of BlackRock’s IBIT Bitcoin ETF.
That’s hundreds of millions in exposure.
At first glance, that looks bullish.
But here’s what most people miss.
Jane Street isn’t a directional investor.
It’s a market maker.
It’s also one of only a handful of firms authorized to conduct in-kind creations and redemptions for Bitcoin ETFs. That gives it direct access to the plumbing connecting ETF shares to actual Bitcoin.
This means:
- They can arbitrage ETF premiums and discounts
- They can move spot BTC into and out of funds
- They can hedge positions through derivatives
- They can hold inventory far larger than retail participants
A 13F filing shows long equity positions.
It does not show:
- Options
- Futures
- Swaps
- Synthetic shorts
So when the public sees “Jane Street owns $790M in IBIT,” that may represent a fully hedged position.
Or worse — a net short exposure disguised as long inventory.
Nobody outside the firm sees the derivative book.
And if the derivative book exceeds the ETF position?
They profit when Bitcoin drops.
Now connect that with systematic 10AM sell pressure.
Here’s where it gets interesting.
After the Terraform lawsuit became public, several traders noted that the daily 10AM flash crashes slowed down significantly.
Bitcoin stabilized.
Later in 2025, the pattern resumed.
It looked like:
Legal spotlight → behavior changes
Spotlight fades → behavior resumes
Correlation is not proof.
But it’s not nothing either.
Jane Street’s crypto conduct hasn’t yet been formally tested by regulators.
But in 2025, India’s Securities and Exchange Board issued enforcement findings against Jane Street entities in index derivatives markets.
The regulator alleged coordinated trading between cash and derivative markets that generated billions in profit.
The structure described?
Move one market.
Harvest the derivative layer above it.
If that sounds familiar, it’s because Bitcoin ETFs + derivatives create the same layered environment.
The question becomes simple:
Is Bitcoin’s price discovery fully organic?
Or influenced by firms sitting at the center of ETF infrastructure?
Bitcoin’s 21M supply cap is enforced at the protocol level.
But price discovery happens in markets layered above the protocol.
If large institutions can create synthetic exposure through derivatives that dwarf real spot supply, scarcity at the base layer doesn’t automatically mean scarcity at the price layer.
If one of the biggest ETF participants also holds offsetting derivatives, they can:
- Trigger liquidation cascades
- Harvest volatility
- Accumulate lower
- Repeat
And retail only sees the surface.
Until disclosure rules change, we don’t know Jane Street’s true net exposure.
That matters.
Because if net exposure is negative, incentives flip.
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One more thing to keep in mind.
Jane Street is also one of the largest holders of the iShares Silver Trust (SLV).
In Q4, it reportedly added over 20 million shares, becoming the largest disclosed holder.
That doesn’t automatically mean manipulation.
But it reinforces a pattern.
This firm operates at massive scale across commodities, derivatives, and ETF plumbing.
If volatility appears mechanical in silver as well, it’s worth watching.
Be cautious trading correlated assets until clarity improves.
Let’s be clear.
Nothing here is proven.
Jane Street denies the Terra allegations.
No regulator has formally accused them of manipulating Bitcoin.
But patterns matter.
Timing matters.
Incentives matter.
This cycle felt different.
Daily 10AM drops.
Weak breakouts.
No euphoria at new highs.
And a market structure increasingly dominated by a handful of ETF gatekeepers.
If Bitcoin is going to function as the hardest money on Earth, its price discovery layer needs transparency.
Until we know Jane Street’s true net exposure, one uncomfortable question remains:
Is Bitcoin trading freely?
Or is someone quietly deciding the price every morning at 10AM?
Stay sharp.
Stay skeptical.
And never assume the structure is neutral just because the protocol is decentralized.
If you enjoyed this blog, you may want to check our other crypto news updates.
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