Bitcoin fans latch onto ‘ridiculous’ Jane Street conspiracy to explain price slump

Bitcoin enthusiasts are speculating on a conspiracy involving Jane Street to explain the cryptocurrency's recent price slump, which has seen a 40% drop since October.

It’s been a tough few months for Bitcoin enthusiasts. The leading cryptocurrency has seen its price plummet over 40% since October, leaving many investors scratching their heads. What’s behind this downturn? Unlike previous dips, there hasn’t been a clear reason. But this week, the digital currency's online supporters have latched onto a new conspiracy theory that points a finger at a well-known name: Jane Street.

Could Jane Street Be Behind Bitcoin’s Price Decline?

According to some members of the ever-vocal Crypto Twitter, Jane Street, a secretive Wall Street trading firm, is allegedly responsible for systematically depressing Bitcoin’s price through dubious ETF-related trading practices. These claims intensified earlier this week when Bitcoin experienced a mid-week rally, with some suggesting that Jane Street’s trading strategies changed after they were exposed.

However, seasoned Wall Street professionals are quick to lambast these claims as flimsy at best. One source close to Jane Street labelled the accusations as “an absolutely ridiculous conspiracy theory.” But what exactly is driving these allegations?

What’s the Role of Jane Street in the Crypto World?

Jane Street is known as an “authorized participant” in the growing ETF market for cryptocurrencies, which includes offerings by firms like BlackRock. Authorized participants, or APs, are typically deep-pocketed firms responsible for ensuring that the price of ETF shares accurately reflects the value of the underlying assets, allowing them to profit from arbitrage opportunities.

For some time, Jane Street has acted in this capacity for Bitcoin. Yet, recent social media posts began to surface, alleging that the firm was engaged in manipulative practices, such as dumping Bitcoin holdings at specific times each morning while simultaneously holding short positions to profit from the resulting price dip. Yet, there hasn’t been any concrete evidence to substantiate these claims.

What Do Experts Say?

Market veterans have expressed skepticism regarding the allegations against Jane Street. Rob Hadick, a partner at Dragonfly Capital and a former Goldman Sachs employee, strongly dismissed the claims, stating: “The argument makes zero sense and completely misunderstands how derivatives and perps/futures work, as well as what an AP does for these ETFs.” His sentiments reflect a growing frustration among professionals who believe that fundamental misunderstandings of market mechanics are driving this unfounded narrative.

Could Recent Events Have Sparked the Conspiracy?

Despite the lack of evidence, Jane Street's reputation in the crypto community has taken a hit. Last week, the firm was dragged into controversy after a lawsuit was filed by the administrator winding down the bankrupt stablecoin issuer Terraform Labs. The lawsuit accused Jane Street of insider trading during Terraform’s collapse, which Jane Street described as “baseless, opportunistic claims.” They pointed out that the downfall of Terraform Labs was due to fraud perpetrated by its imprisoned founder.

The situation seems to have fueled existing resentment against Jane Street, a sentiment that may be partly attributed to its connection with discredited figures in the crypto world. Notably, the firm once employed Sam Bankman-Fried and Caroline Ellison, both now infamous for their roles in the FTX fraud scandal. Such connections have generated bad feelings among some traders, especially those envious of the firm’s consistently profitable trading strategies.

Are Traders Searching for a Scapegoat?

As Bitcoin's price continues to struggle, the emergence of conspiracy theories about Jane Street suggests that traders are eager to find a scapegoat for their losses. “It’s just people who don’t understand markets and want there to be a boogeyman to blame for why they haven’t made more money,” Hadick commented.

As Bitcoin remains volatile and uncertain, it’s crucial for traders and investors to stay informed and realize that market downturns often have complex underlying factors rather than being orchestrated by a single entity or firm. Platforms like Binance, Bybit, Bitget, OKX, and MEXC continue to offer competitive rates for those looking to trade in this erratic environment. You can check out our referral pages for exclusive bonuses that can enhance your trading experience.

• Bitcoin's price has fallen over 40% since October 2025, leaving investors puzzled.
• Some members of Crypto Twitter are blaming Jane Street for the downturn through alleged ETF manipulation.
• Expert opinions overwhelmingly dismiss these conspiracy claims as unfounded.
• Jane Street's controversies and its connections to figures in past scandals may have exacerbated negative perceptions.
• Amid market volatility, traders should seek reliable information and competitive exchanges for their trading needs.