The Price Drop at 10 AM: How Jane Street Caused Bitcoin's Price to Crash

Everyone knows Bitcoin should be worth at least $150,000 right now.
Yesterday, a federal lawsuit was filed in Manhattan explaining exactly why that’s not the case.
Let’s connect these three elements for the first time: a federal insider trading case built on a private chat group called “Bryce’s Secret,” a systematic sell program at 10 a.m. that suppressed Bitcoin’s price until the end of 2025, and an undisclosed derivatives order book that could turn the largest Bitcoin ETF position in history into a tool to suppress Bitcoin’s price.
All three storylines lead to one name: Jane Street Capital.

Intern
The story begins with an intern named Bryce Pratt.
Pratt previously interned at Terraform Labs, a Singapore-based company behind the algorithmic stablecoin TerraUSD and its Luna token. He left Terraform and joined Jane Street as a full-time employee in September 2021.
Jane Street is also where SBF learned trading before founding FTX and Alameda Research, and many of his future colleagues came from or had ties to this firm.
According to a lawsuit filed by Todd Snyder, Terraform’s bankruptcy manager, Pratt became a bridge between his former and new companies through a chat group described in court documents as “Bryce’s Secret.”
The lawsuit alleges that Jane Street used this channel to gather critical insider information about Terraform’s internal fundraising moves.
A key moment was May 7, 2022. Terraform withdrew $150 million of TerraUSD from Curve3pool, a decentralized trading platform serving as the main liquidity hub for this stablecoin.
Within ten minutes of the withdrawal, before Terraform announced anything publicly, an address linked to Jane Street withdrew $85 million of TerraUSD from the same pool.

The combined selling pressure contributed to UST’s de-pegging from the dollar.
Within days, Luna’s automatic token minting and burning mechanism spiraled out of control, causing hyperinflation of the token supply and destroying $40 billion in market value.
Retail investors suffered catastrophic losses.
According to the lawsuit, Jane Street avoided potential losses of over $200 million by divesting at the right moment, “just hours before Terraform’s ecosystem collapsed.”
The lawsuit describes these trades as “impossible to execute without the insider information that [Jane Street] uniquely possessed.”
Jane Street dismisses the lawsuit as “desperate” and “baseless,” claiming that the losses Terra and Luna holders suffered were caused by Terraform’s own fraudulent actions.
Do Kwon is currently serving a 15-year sentence. Snyder has also filed a separate $4 billion lawsuit against Jump Trading for alleged manipulation of a similar collapse, indicating a systematic investigation into organizational behaviors during the Terra crisis, not just a single company’s misconduct.

The Clock
Starting late 2024 and accelerating through 2025, Bitcoin’s price began to exhibit movements that traders noticed but couldn’t explain.
Every trading day at 10 a.m. Eastern, coinciding with the opening of the US stock market, Bitcoin experienced sudden, sharp sell-offs.
These drops occurred precisely, algorithmically, and were completely disconnected from overall market conditions.
They wiped out long leveraged positions, triggered cascading liquidations, and then reversed within hours.
Jan Happel and Yann Allemann, co-founders of blockchain analytics firm Glassnode, documented these patterns through their shared Negentropic account.
They tracked the accuracy of the algorithm during these declines over several months, and the pattern was unmistakable.
Charts from December show Bitcoin dropping from $89,700 to $87,700 in just a few minutes after the 10 a.m. open, wiping out $171 million in long positions before rebounding.
This happened every day, day after day.

Jane Street, as a designated market maker and authorized participant for multiple Bitcoin ETFs, holds both inventory and infrastructure to execute coordinated large-scale sales during predictable liquidity windows.
Selling into a thin order book at open can depress prices, trigger chain liquidations among leveraged traders, and create buying opportunities at lower prices.
They can then re-enter the market at the bottom of the dip they caused.
And then, an exposé occurred.
According to Glassnode’s co-founders, these daily sudden drops stopped after lawsuits against Terraform Labs became public early last year.
Bitcoin’s price stabilized significantly in subsequent trading sessions.
This behavioral shift aligns with a company suddenly needing to consider legal evidence and testimony.

The 10 a.m. trading pattern returned in Q3 2025 and was back in full force by December.
Basically, the 10 a.m. sell-offs ceased once Jane Street’s lawyers stepped in, only to resume when the situation cooled down.

The Machine
In the Q4 2025 13F filing, Jane Street disclosed holding 20,315,780 shares of IBIT, worth about $790 million.
The firm bought an additional 7,105,206 shares this quarter, increasing their stake by $276 million.
Last year, their total IBIT holdings neared $2.5 billion.
At the same time, they increased their MicroStrategy holdings by 473%, acquiring 951,187 shares valued at around $121 million, even as BlackRock and Vanguard divested billions from MSTR during the same period.

If you don’t understand what Jane Street really is, this might look like accumulation-driven price appreciation.
Jane Street is one of only four firms authorized to create and buy back securities derivatives (IBIT).
The other three are Virtu Americas, JP Morgan Securities, and Marex.
Jane Street is also an authorized participant for Fidelity and WisdomTree’s Bitcoin ETFs.
This role allows direct access to the mechanism linking ETF share prices to actual Bitcoin.
They can move Bitcoin in and out of the ETF structure, exploiting price discrepancies between the fund and the spot market, and maintain a much larger inventory than any typical market participant.
Essentially, Jane Street has direct access to the link between Bitcoin ETFs and actual Bitcoin, something almost no one else can do.

Crypto media reports on the 13F as a sign of institutional confidence.
But those who truly understand market structure immediately see otherwise.

The Invisible Book
Former hedge fund manager Michael Green calls the optimistic interpretation of Jane Street’s 13F “worrying.”
He points out that Jane Street’s IBIT position “is almost entirely offset by undisclosed options and futures positions,” and that “they certainly aren’t ‘accumulating’ Bitcoin positions. That’s how market makers operate.”
Former securities trader Ryan Scott is more blunt: “Anyone posting this with a bullish headline is committing a serious crime. This should be titled ‘You’ll never guess who’s holding offsetting derivatives positions that don’t need to be reported.’”
Nik Bhatia simplifies the motive: “Jane Street owns IBIT so they can write options, trade spreads, and do everything a quant trading firm does to make quick money.”
This is what it means for anyone holding Bitcoin or IBIT.

The 13F filing shows long-term stock holdings.
It doesn’t require disclosure of options, futures, or swaps.
When Jane Street reports holding $790 million in IBIT, the filing doesn’t reveal whether those shares are hedged with puts, offset with short futures, or wrapped in a “collar” strategy that makes their net exposure to Bitcoin zero or even negative.
The public only sees accumulation.
The actual position could be a large short position disguised as a buy order because half of the offsetting trades are not publicly disclosed under current regulations.

The 13F is a snapshot of one side of the balance sheet.
No one outside the firm can see the other side.
This raises an unavoidable question for Bitcoin holders:
If the firm holds $790 million in IBIT and offsets that with $790 million in puts or short futures, their net risk is zero.
If their derivatives portfolio exceeds their stock position, their net risk is negative, meaning Jane Street profits when Bitcoin’s price drops.
In either case, they have every incentive to use their privileged position as an authorized participant to suppress spot prices, trigger liquidations, and profit from the spread.

What is Jane Street’s actual net exposure to Bitcoin?
Current legal frameworks do not require them to answer this question.

Precedent
Jane Street’s activities in the Bitcoin market have not been scrutinized by regulators.
But their activities in other markets have.
In 2025, India’s Securities and Exchange Board (SEBI) issued a 105-page enforcement order against Jane Street entities for manipulating BANKNIFTY index options.

SEBI found that the firm used coordinated trading across cash and derivatives markets to generate profits of ₹36,502 crore (about $4.3 billion) over two years, including ₹735 crore in a single trading day.
The regulator described this activity as clearly illegal in any country with an effective financial regulator and issued temporary trading restrictions.
Jane Street’s strategy in Indian index derivatives followed a familiar pattern: exploiting speed and scale to influence a market, then profiting from the derivative layer above it.
The question is whether a similar logic applies to Bitcoin.

21 Million
The maximum supply of 21 million Bitcoin is enforced by a network of independent nodes.
This cap is based on the assumption that price discovery is honest, markets reflect true supply and demand, and that when institutions hold Bitcoin or similar tools, their positions genuinely represent exposure to the asset, not raw material for undisclosed derivative strategies.
In other words, the 21 million cap only works if the market above that level operates transparently.

Jane Street is one of only four firms holding the keys to Bitcoin ETF infrastructure.
This firm faces a federal lawsuit alleging insider trading causing $40 billion in damages.
They are accused of running algorithmic sell programs to suppress Bitcoin’s price for months.
They hold the largest publicly disclosed ETF position while maintaining a derivatives portfolio that could make their actual risk profile opposite to what’s stated in filings.

Thus, the cap becomes meaningless if Jane Street can create unlimited synthetic supply through undisclosed derivatives layered on their ETF holdings.
Bitcoin’s scarcity is real at the protocol level, but the price discovery mechanism above it has been exploited for profit, and the current public framework allows them to do so unnoticed.
Every Bitcoin holder deserves to know: what is Jane Street’s true net position?

Until we know more, Jane Street will continue to set Bitcoin’s price.