Crypto: Analysts Reject Jane Street ‘10 A.m. Dump’ Claims, Say Bitcoin...

Crypto traders blame Jane Street for a daily 10 a.m. Bitcoin dip after a Terraform lawsuit claimed dubious trading practices, but analysts say timing matches broader risk repricing.

Cryptocurrency investors accused quantitative trading company Jane Street of pressuring Bitcoin’s price with a daily, programmatic sell-off at the US market open, but market analysts and data suggest the pattern is not consistent, and no single company can force Bitcoin into a prolonged bear market.

The claims surged online a day after Terraform Labs’ court-appointed administrator sued Jane Street, alleging insider trading tied to transactions that worsened the collapse of Terra’s algorithmic stablecoin ecosystem in May 2022.

Several market watchers, including crypto influencer Justin Bechler, have argued that Jane Street’s holding of BlackRock’s iShares Bitcoin Trust exchange-traded fund (ETF), known as IBIT, could mask a net short Bitcoin position through hedges that do not appear in public filings. Bechler argued that Jane Street conducted coordinated algorithmic selling of Bitcoin at 10 a.m. Eastern Standard Time daily, manipulating the Bitcoin (BTC) price to buy the ETF at a discount.

”When Jane Street reports holding $790 million in IBIT shares, the filing tells you nothing about whether those shares are hedged by puts, offset by short futures, or wrapped in a collar that makes the firm's net Bitcoin exposure zero or even negative,” wrote Bechler, adding that the ”actual position could be a massive short that looks like a long because the offsetting half of the trade is invisible under current disclosure rules.”

CryptoQuant’s head of research, Julio Moreno, cautioned that the activity Bechler described is not unique to one company. He said buying spot exposure while selling futures is a common approach for delta-neutral funds seeking to capture spreads rather than directional price moves.

Jane Street’s latest 13-F filing also disclosed holdings in Strategy, as well as sizable positions in Bitcoin mining companies Bitfarms, Cipher Mining and Hut 8.

The online narrative centers on the idea that Bitcoin regularly drops shortly after 10 a.m. Eastern Standard Time, a window that overlaps with the start of US trading. Onchain analyst Nonzee posted an hourly Bitcoin chart on Wednesday and claimed Jane Street had been “manipulating” the market at that time for months.

Crypto market watcher account Whale Factor claimed Bitcoin has consistently registered a 2% to 3% daily d

Source: CoinTelegraph