TLDR
- BTC experienced a nearly 7% surge amid theories that Jane Street discontinued its alleged morning selling algorithm following legal action
- An 83-page complaint was lodged against Jane Street by Terraform Labs’ bankruptcy administrator on February 23, claiming insider trading connected to the TerraUSD 2022 crash
- BTC pushed past $68,000, contributing over $170 billion to the overall cryptocurrency market valuation
- A recurring morning selloff pattern showed Bitcoin declining during the initial trading hour in more than 60% of sessions starting in early November
- Market watchers indicate BTC must maintain levels above $64,000 and breach $66,535 resistance to continue upward momentum
Bitcoin delivered one of its most impressive daily performances this year on Wednesday, climbing approximately 7% to surpass $68,000. This upward movement contributed more than $170 billion to the aggregate cryptocurrency market capitalization, elevating it to $2.4 trillion.
The price surge coincided with widespread online discussion about proprietary trading firm Jane Street gaining traction. Market participants across Crypto X and Reddit had consistently observed a phenomenon where Bitcoin’s overnight price increases would evaporate within moments of U.S. stock markets opening at approximately 10 a.m. Eastern Time.
From early November onward, Bitcoin experienced price drops during the opening hour of U.S. trading sessions in over 60% of occurrences, frequently losing as much as 3% during that timeframe. On December 4, the cryptocurrency fell 2.1% within an 18-minute window while the S&P 500 opened without significant movement.
Market observers theorized that Jane Street operated an automated trading system designed to sell Bitcoin precisely at 10 a.m. each trading day, preventing potential price rallies and facilitating repurchases at reduced prices.
Researcher “Bark” shared on X: “Jane Street was running an algorithm that dumped Bitcoin every single morning at 10am. Every day. For months. Crashing the price. Liquidating retail. Buying back lower. Rinse and repeat.”
Investment professional Mike Alfred intensified speculation by asserting he had communicated with an inside source at Jane Street who claimed company leadership had mandated an “immediate cessation” of the controversial trading approach. Alfred stated that the alleged “10 a.m. algo” had been terminated. CCN attempted to contact both Alfred and Jane Street for verification but did not receive responses. These assertions remain unconfirmed.
Jane Street has rejected all accusations, characterizing them as “baseless.”
The Lawsuit Behind the Speculation
The heightened attention comes after Terraform Labs’ bankruptcy administrator filed a comprehensive legal complaint on February 23. The 83-page document accuses Jane Street, along with co-founder Robert Granieri and two staff members, of engaging in insider trading and market manipulation prior to the 2022 TerraUSD implosion, which eliminated approximately $40 billion in market capitalization.
The legal filing claims that confidential, non-public data from Terraform insiders was transmitted to Jane Street to enable front-running of market positions.
Bloomberg ETF expert Eric Balchunas suggested that if persistent selling pressure has indeed ceased, Bitcoin may experience a durable price recovery.
Technical Levels to Watch
Market analysts observed that Bitcoin’s RSI indicator had recently approached 30, an oversold threshold frequently linked with short-term price bounces.
Information from CoinMarketCap revealed a 95% correlation between Bitcoin and the S&P 500 during the 24-hour window, indicating broader market dynamics also influenced the movement. Traditional markets advanced during that session as artificial intelligence-related uncertainties diminished before Nvidia’s earnings announcement.
Bitcoin reached an intraday peak of $69,819 before experiencing a pullback. Technical analysts emphasize that the asset must sustain levels above $64,000 and overcome resistance at $66,535 to preserve upward trajectory. Failure to accomplish this could result in a retest of support around $60,074.
Bitcoin had dropped below $63,000 earlier during the week and continues trading nearly 50% below its October all-time highs.
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