After Jane Street Halts 10% Sell-Off, BTC Sees Strong Rebound

Original Title: "Jane Street Stops '10 AM Selling Pressure,' BTC Strongly V-Rebounds Toward $70,000 Key Level"

Original Author: Ding Dang, Odaily Planet Daily

Market data shows that in the past 24 hours, BTC has experienced a V-shaped strong rebound, once approaching the $70,000 key level, currently trading at around $68,000, with a 6.1% increase in the last 24 hours. The prices of ETH and SOL have also shown very strong performance, following Bitcoin's rebound with significant upward movement. ETH briefly surpassed $2,100, with a 15% increase in 24 hours, currently trading at $2,050; SOL briefly surpassed $90, currently trading at $87, with an 8.1% increase in 24 hours. Market sentiment has significantly improved. All three have now reached key resistance levels, and attention is on whether they can hold steady and continue to rise.

In the U.S. stock market, the Dow rose by 0.63%, the S&P 500 index rose by 0.81%, and the Nasdaq rose by 1.26%; the crypto sector showed collective strength, with Circle rising by 35.47%, recovering its one-month decline in a single day.

In the derivatives market, in the last 24 hours, the total liquidation amount was $579 million, with long liquidations totaling $115 million and short liquidations $464 million. The largest single liquidation occurred on Hyperliquid - BTC-USD, worth $10.4154 million.

On the liquidity side, according to sosovalue data, yesterday's Bitcoin spot ETF recorded a net inflow of $250 million in a single day, possibly ending the previous five-week streak of net outflows. LookIntoChain observed that in the past 5 hours, BlackRock's Bitcoin exchange-traded fund IBIT saw a net inflow of 1,225 BTC, worth $83.92 million.

Bitcoin Should Be Worth At Least $150,000

This morning, a seismic event in the crypto industry began with a single statement: "As is well known, Bitcoin should now be worth at least $150,000."

The reason is that as Terraform Labs liquidates the market, suing the well-known U.S. market maker Jane Street, it has unveiled a months-long market suspicion storm. A lengthy article that quickly spread on X (by author Justin Bechler) linked three clues together, directly accusing Jane Street of systematically suppressing the Bitcoin price through a privileged position, causing it to be far below its "rightful" level.

The core allegations are divided into three acts:

Act One: Allegations of Terra/LUNA's Collapse Insider Old Debt. This act involves obtaining insider information through the private group "Bryce's Secret" created by former intern Bryce Pratt, enabling early exit and accelerating the collapse. The lawsuit claims that these trades were "impossible to execute without non-public information" and seeks compensation;

Act Two: The Eastern U.S. 10 AM "Preset Plunge" Pattern. Almost every trading day, Bitcoin experiences a mysterious 2-3% plunge around this time, precisely liquidating leveraged long positions, only to rebound hours later. On-chain analyses by Glassnode and others show a highly regularized algorithmic selling pressure. Interestingly, after the Terra lawsuit exposure, this "10 AM dive" pattern briefly disappeared; however, once the heat died down, it resurfaced;

Act Three: Ostensible Super Bullishness Masking Potential Massive Net Shorts. Public 13F filings reveal that Jane Street holds over 20 million IBIT shares (with a market value nearly reaching $25 billion), and MSTR positions surged by 473%, appearing to be extremely bullish. Nevertheless, insiders suggest that Jane Street outwardly accumulated a significant amount of Bitcoin spot inventory through ETF creation/redemption mechanisms, potentially leveraging it to issue a large volume of Bitcoin options. They then maintained directional neutrality through derivatives hedging, seemingly continuously injecting synthetic Bitcoin supply into the market, undermining Bitcoin's scarcity narrative and creating a long-term upward price resistance anchor;

The aftermath of this statement continues to brew, with the Terraform liquidator's allegations against Jane Street awaiting court rulings to verify. However, this dispute has provided the market with an emotional outlet.

Nevertheless, Monad co-founder Keone Hon also stated that the conspiracy theory of Jane Street suppressing Bitcoin below $150,000 is unfounded. Forcing the IBIT position of the shorts through long futures hedges implies that, on average, other parties will eventually hold short futures positions, which they must hedge with long spot positions. The sum of all positions in the market (converted to delta values) always equals Bitcoin's total supply (approximately 20 million coins). Of course, any party can independently decide to go short, thereby increasing long positions. In simple terms, hedging futures with ETFs implies that there are always matching positions in the market, allowing short-term distortions but making it difficult to violate the conservation of supply and demand in the long term.

Market Confidence Boosted by Two Earnings Reports

If conspiracy theories provided emotional tension to the market, perhaps what truly drove prices up were two earnings reports that exceeded expectations.

The first one came from Circle, which delivered a very impressive 2025 Q4 and full-year earnings report. Q4 revenue reached $7.70 billion, a 77% year-over-year increase and a 4.1% quarter-over-quarter increase, surpassing the market's previous expectation of $7.49 billion. Most importantly, the EPS (Earnings Per Share) also exceeded expectations by far, demonstrating a significant enhancement in profitability, mainly driven by the resurgence in USDC volume and interest income from the high-rate environment. At the same time, USDC circulation saw a significant year-over-year increase, on-chain transaction volume continued to expand, indicating that the structural demand for stablecoins is still on the rise, which is the core reason why the market has provided positive feedback. At the very least, it proves that the panic caused by the previous whale sell-off was more of a position rebalancing, with funds still staying within the crypto industry, likely just waiting for the right moment to "buy the dip."

The second earnings report comes from NVIDIA. Its Q4 revenue of $68.1 billion and data center revenue of $62.3 billion also exceeded market expectations, and once again provided an optimistic quarterly revenue forecast, guiding around $78 billion, higher than the market estimate of $73 billion, indicating that large-scale AI computing infrastructure is still on track.

This is crucial for the AI narrative; the market needs NVIDIA to prove that the AI investment frenzy can translate into sustainable returns and dispel concerns about the AI bubble.

Institutional Asset Allocation and Miner Sector Dynamics

There have been subtle changes on the demand side.

Several university endowment funds are adjusting their investment strategies amid declining returns on traditional assets, beginning to allocate to cryptocurrency ETFs. Harvard University and Brown University have disclosed positions in Bitcoin and Ethereum ETFs in their latest 13F filings. Although relatively small compared to their overall portfolio sizes, it shows that digital assets have moved from the fringes of institutional finance to the mainstream toolkit.

Against the backdrop of consecutive Bitcoin drops, many small and medium-sized DATs have surrendered, choosing to sell off their Bitcoin holdings or terminate their buy programs. It seems that only the Remain Strategy remains the market's sole bullish force, but DDC Enterprise Limited announced this week that they have added 50 bitcoins to their holdings. Their total Bitcoin holdings now amount to 2,118 bitcoins, making it the 34th largest holder of Bitcoin among global publicly listed companies, continuously increasing their Bitcoin holdings for the seventh consecutive week.

The dynamics in the miner sector are also worth noting. While the price of Bitcoin has fallen, the stock prices of several mining companies have risen against the trend, such as TeraWulf's stock price rising by 31% this month, Cipher Mining by 8%; Hut 8 by 6%; Core Scientific remaining mostly flat. Analysts believe that Bitcoin mining companies are currently one of the targets with a high short position by hedge funds. If the fundamentals improve, it may trigger a short squeeze, and these companies have locked in long-term and attractive power contracts, giving them a structural advantage in energy costs. Their strategic value lies not only in their Bitcoin mining business but also in the fact that capital is flowing towards "structural winners," while traditional mining companies may face marginalization risks.

Conclusion

This V-shaped rebound may not mark the beginning of a trend reversal, but it has accomplished something more important by providing a new framework for interpreting the market. As the market regains a rationale for the price surge, there is a possibility for the reconstruction of risk appetite.

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