Bitcoin, Ethereum Escape 10AM Manipulation as Jane Street Sued

Key Insights

• Bitcoin and Ethereum led the crypto market rebound for the second consecutive day without the “10AM manipulation.”
• All it took was one lawsuit against Jane Street, and the BTC price started to go up.
• The entire crypto market started pumping again, but coincidence was probably doing a lot of the heavy lifting.

Manipulation. Manipulation. Manipulation… The word that lives rent-free in retailers’ minds. The crypto market has been subject to manipulation, though there was no clear evidence pointing to this.

The lawsuit shifted market behavior during the 10AM hour. Traders reacted sharply at a time when many had suspected price manipulation in crypto markets.

The development comes as ZachXBT announced that he would be exposing some protocols that have been involved in insider trading. All these updates stressed the fact that markets were not safe, especially after Wall Street raided crypto markets.

The piece will now explore how this trading activity stopped over the past two days. It will also examine whether the markets are finally operating without manipulation.

Crypto Market Dodges ‘10AM Manipulation’ Amid Jane Street Lawsuit

As per the recent updates, Terra Labs sued Jane Street. They alleged that the firm participated in insider trading that resulted in the Terraform crash in 2022. Per the lawsuit, Terra Labs alleged that Jane Street dumped UST into a drained pool, leading to a loss of about $39 billion.

This lawsuit shook confidence across the crypto market. Investors were worried because Jane Street had already been accused of manipulating the 10AM Bitcoin and major cryptocurrencies.

A single entity like Jane Street, controlling about a fifth of global trading volume, could potentially carry out the manipulation.

What raised concern was the fact that the firm was affiliated with BlackRock and Fidelity’s Bitcoin ETFs. This probably meant they were doing it for the firms to buy BTC at a lower price and shake out retailers.

In connection with the lawsuit, the usual drop during market open hours has since ceased for the last two consecutive days. In fact, the market has been rising with just normal pullbacks.

These developments explained the reason for such sudden pumps, especially during market opening hours for the U.S. region.

BTC price at 10AM after Jane Street lawsuit | Source: Bull Theory

The aftermath of the lawsuit potentially affirmed that Jane Street could be involved in market manipulation. Interestingly, this could come to an end, especially if the CLARITY Act was passed into law.

These regulations are expected to reduce such activities by about 70% to 80%. As such, the broader market also found relief as it followed Bitcoin’s footsteps.

Bitcoin and Ethereum Pump As Crypto Market Rebounds

Looking at the price action of Bitcoin alongside that of Ethereum (ETH), there was some symmetry in movement. The two bounced energetically during the first hour of trading.

For instance, Bitcoin rallied by about 3%, reclaiming the lost support at $65,000. At the same time, Ethereum surged past $1,900 from $1,843.

BTC/USDT vs. ETH/USDT price action charts | Source: TradingView

Additional data from CoinMarketCap showed that the relief of the lawsuit was spread across the whole sector. ETH continued to rise, reclaiming the $2,000 level following an 11% rally.

All five of the top cryptos showed gains. Ripple (XRP) jumped 8.1%, while Binance Coin (BNB) climbed 6.9%.

The entire crypto market was also up by about 3%. Memecoins were among the top trending tokens for the day as they faced similar scrutiny.

Daily crypto market performance | Source: CoinMarketCap

Altogether, the analysis indicated that manipulation was bearish in sentiment as it scared away crypto traders. Hence, for the market to maintain the pump instead of dumps during opening hours, the lawsuit had to be addressed.

Furthermore, passing the CLARITY Act would make a lot of difference going forward, especially on Wall Street.

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