- Speculation is growing on X that Jane Street may have deliberately depressed the Bitcoin price via spot ETFs and futures markets.
- Reliable evidence of this is still missing, while critics tend to point to structural weaknesses in the ETF architecture.
The conspiracy theory that Jane Street is manipulating the Bitcoin price has gained momentum again on X in recent days. The trigger was the lawsuit filed by the insolvency administrator of Terraform Labs against Wall Street giant Jane Street over a possible insider trade in the collapse of the Terra ecosystem.
The theory: Jane Street is manipulating Bitcoin
In a viral one X-Post Roberto Rios (on X: @peruvian_bull) refers to the lawsuit filed in Manhattan, as CNF reported. Rios writes that the Terra lawsuit must be seen in context. He refers to a procedure by the Indian stock exchange regulator SEBI. In July 2025, Jane Street accused Jane Street of deliberately manipulating the Bank Nifty index on 18 days between January 2023 and March 2025.
According to the agency, the company aggressively bought stocks and futures in the morning, then pushed the market lower again later. Jane Street thus benefited from massive short option positions. The SEBI speaks of the equivalent of around 580 million US dollars in ill-gotten gains and of a “deliberately designed instrument to manipulate settlement prices”.
The Bitcoin price development since November 2025 should be viewed against this background. The Bitcoin price repeatedly crashed at around 10:00 a.m. Eastern time, i.e. at the start of US stock trading. Rios and others cite countless trading days in which Bitcoin fell sharply within minutes of the start of the US stock exchange.
Suspicion was primarily directed at Jane Street because the company is one of the authorized participants of the BlackRock ETF IBIT and therefore has direct access to the issuance and redemption process of ETF shares. On the other hand, Rios argues that Jane Street is the second largest holder of the BlackRock Spot Bitcoin ETF IBIT after Millennium Management LLC, according to 13F filings.
His thesis: Sell spot Bitcoin and ETF-related products in the morning, depress the market, flush leveraged longs out of the market, buy them back later at a cheaper price. With Terraform Labs’ lawsuit against Jane Street, the pattern has suddenly stopped. Bitcoin rose more than 7% yesterday because the “10am dump” didn’t happen. Jane Street has been exposed, or so the theory goes.
Why there is probably no “manipulation”.
ProCap CIO and Bitwise advisor Jeff Park contradicts the theory, but sees a different structural problem. For him, the “billion-dollar question” is not whether a single Wall Street firm is actively “pushing” Bitcoin, but rather whether the ETF architecture can distort pricing. He wrote via X on February 25th:
“The short answer is that no Authorized Participant explicitly suppresses the Bitcoin price. What the AP structure can suppress is the integrity of the price discovery mechanism itself. That is not the same thing – but the latter may be more consequential.”
Park argues that Authorized Participants are structurally privileged through regulatory exemptions under Reg SHO. They could create and short sell ETF shares as part of creation and redemption processes in a way that is not possible for other market participants.
It is also crucial that a short in IBIT does not necessarily have to be hedged with spot Bitcoin. If futures are used instead, there is no immediate buying pressure in the spot market. With the recent approval of in-kind creations and redemptions, this flexibility has become even greater. He writes:
“Each AP on the IBIT list operates within the same structural framework, with the same exceptions, and thus with the same theoretical capacity. Whether any of them utilize that capacity in a manner bordering on coordinated activity is a question […] for the SEC. Whether these arrangements are sufficient to capture conduct that simultaneously spans spot, futures and ETF markets – including offshore trading venues – remains an open question.”
However, macro analyst Alex Krüger contradicts the basic assumption that there is a significant “10am dump” based on the data. For him, the theory is “another flawed conspiracy theory.” He writes today via X:
“I checked the data and that’s not true. Since January 1, IBIT’s cumulative return is +0.9% in the 10:00 to 10:30 a.m. window and -1% in the 10:00 to 10:15 a.m. window. So these are fluctuations, not a systematic fall in prices.
Even more interesting: the performance in both time windows largely corresponds to that of the Nasdaq. The alleged “10 o’clock dump” is just a general reassessment of risk assets. The conventional wisdom is wrong.”
No Comments