The 10AM Dump: Did Jane Street Break Bitcoin?

Summary: For months, traders watched Bitcoin dump like clockwork at 10am ET. Then a lawsuit dropped alleging insider trading at Jane Street — and the pattern vanished. Bitcoin rallied 7% in 24 hours, adding $170 billion to crypto markets. Coincidence or consequence?

The Pattern That Haunted Bitcoin

If you've traded Bitcoin over the past few months, you've probably noticed it. Every morning at 10am Eastern Time, the same thing happened: sell pressure would flood the market, liquidating long positions and killing whatever momentum had built overnight.

It became so predictable that traders started calling it the "10am dump." CT was full of screenshots showing the same pattern, day after day. But nobody could prove who was doing it or why.

Until now.

The Lawsuit That Changed Everything

On February 23, 2026, Todd Snyder — the bankruptcy administrator winding down Terraform Labs — filed a federal lawsuit in the Southern District of New York. The target: Jane Street Group, the quantitative trading giant that handles roughly 10% of all U.S. equity trades and generated $20.5 billion in net trading revenue last year.

The lawsuit alleges that Jane Street used material non-public information from Terraform Labs insiders to avoid over $200 million in losses before the Terra/Luna ecosystem collapsed in May 2022.

Enter Bryce Pratt

The complaint names Bryce Pratt, a former Terraform Labs intern who joined Jane Street in September 2021. By February 2022, Pratt had set up a group chat called "Bryce's Secret" that included a Terraform software engineer and members of Terraform's business development team.

In one exchange cited in the filing, the Terraform engineer wrote: "bro we all know who the buyer is. its where u work... Jane Streeeeeeeet."

When asked about the legality of what Jane Street was doing with the information, Pratt allegedly responded: "everything. Probably ya. If jump can legally do smtg we probs can too."

The May 7 Trade

The complaint's central allegation concerns May 7, 2022. That day, Terraform withdrew 150 million UST from Curve3pool — a decentralized exchange — as part of a liquidity migration that had not been publicly announced.

Within 10 minutes, a wallet linked to Jane Street pulled 85 million UST from the same pool. It was the largest single swap the platform had ever processed. The combined withdrawal destabilized UST's liquidity. Within a week, the Terra Luna ecosystem had collapsed, wiping out roughly $40 billion in value.

According to the complaint, this trade "would have been impossible without inside information."

Jane Street has called the suit "desperate" and a "transparent attempt to extract money."

The Day the Dump Stopped

Here's where it gets interesting for Bitcoin traders.

The day after news of the lawsuit became public, the "10am dump" pattern — which had been observed for months — simply didn't appear. Instead, Bitcoin rallied 7%+ to nearly $70,000, triggering a wave of short liquidations and adding over $170 billion to crypto market cap in 24 hours.

Crypto investigator "Bark" posted 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. The second they got sued it stopped. The 10am dump disappeared. Now Bitcoin just had the best day in months."

Bloomberg analyst Eric Balchunas echoed the sentiment:

"The bogeyman is gone.. That's the vibe rn on CT and in the price action today. I get it too, that big daily dump seemed to kill every rally and everyone's spirit."

The Skeptical Take

Not everyone is convinced. Some analysts argue that time-based volatility around the US market open is common across all asset classes — not unique to crypto.

The 10am ET window coincides with:

• US stock market opening (9:30am ET)
• High liquidity period in first 30-60 minutes
• Major macroeconomic data releases (often 8:30am or 10am)
• ETF hedging and rebalancing
• Options expiry dynamics

A pattern breaking doesn't automatically prove prior manipulation. The Bitcoin rally could be driven by:

• Short squeeze dynamics
• Heavy positioning imbalance
• Liquidity vacuum above resistance
• Broader macro volatility

Important clarification: The lawsuit relates to events surrounding UST and Terra — not proven daily BTC manipulation. There is currently no verified evidence that Jane Street was systematically dumping Bitcoin at 10am every day.

What This Means for Markets

Regardless of whether the "10am dump" narrative proves true, the implications are significant:

1. If true: A single quantitative trading firm was able to suppress Bitcoin's price for months through algorithmic selling. The market is more manipulated than many believed.

2. If false: CT is running with narratives that conflate correlation with causation. Pattern recognition is dangerous when it ignores alternative explanations.

3. Either way: The timing coincidence is remarkable. Whether Jane Street was running a manipulation algo or simply pulled back due to legal exposure, the perception that they were has already shaped market psychology.

The Bottom Line

Bitcoin just had its best day in months. The "10am dump" pattern that killed rally after rally seems to have vanished. And a lawsuit alleging insider trading at one of Wall Street's most powerful quant firms is at the center of the story.

Is it manipulation? Coincidence? Or something in between?

We don't know yet. But the market is acting like the bogeyman is gone — and that's worth paying attention to.

This article is for informational purposes only and does not constitute financial advice. The allegations described are from legal filings and have not been proven in court.