Unveiling Jane Street: Wall Street's Most Secretive Money-Making Machine, A Key Driver Behind BTC's Plunge

Once might be a coincidence, three times might be luck, but what about the tenth time?

Starting in the second half of 2025, some traders following Bitcoin's movements on Twitter noticed something strange. They reviewed the intraday charts of Bitcoin from the past six months and grew increasingly uneasy: almost every day around 10 a.m., just as the U.S. stock market opened and market sentiment was most active, Bitcoin would experience a sharp, clean drop, precisely erasing its earlier gains.

He posted this discovery on Twitter, and unexpectedly, the comments section revealed many others who had noticed the same thing: "I noticed it too," "It's been going on for months," "This is definitely not a coincidence."

Financial media figure ZeroHedge was even more direct, posting tweet after tweet since last July, pointing the finger directly at one of the primary market makers for Bitcoin spot ETFs: Jane Street. After the 10 a.m. sell-off, Jane Street quietly accumulated positions; they hold over $2.5 billion in BlackRock's Bitcoin ETF, IBIT.

They even gave this phenomenon a name: the "Jane 10 a.m. Dump Strategy." What recently brought this rumor back into widespread circulation was a lawsuit from Terra.

An Intern Named Bryce

Recently, the bankruptcy administrator for Terraform Labs filed a lawsuit in court. The defendants are Jane Street, Jane Street's co-founder Robert Granieri, and two traders, Bryce Pratt and Michael Huang.

This is an extremely low-profile company on Wall Street. It never gives media interviews, never boasts about profits, and for a long time, people outside the industry didn't even know it existed. But within the financial industry, Jane Street's name is almost universally known. It is an institution that has earned tens of billions of dollars through quantitative trading and market-making, with annual per capita profits unmatched across Wall Street.

The core factual allegations in the lawsuit are not complicated: on the eve of the UST (TerraUSD) collapse in 2022, Jane Street, using non-public information obtained from insiders, completed its position unwinding in advance, quietly exiting unscathed before the entire $40 billion Terra ecosystem vanished into thin air.

The starting point of this "insider information" trading was a young man named Bryce Pratt.

Bryce Pratt was once an intern at Terraform and later joined Jane Street. Under normal logic, a previous internship would be just an unremarkable line on a resume. But the court complaint spends three full pages (pages 29 to 31) describing him for one reason: after leaving Terraform, he never truly left.

He created a private group chat, adding Terraform's software engineers and business development leads. The group was named "Bryce's Secret."

The name was quite straightforward and bold. According to the lawsuit, the function of this group chat was to continuously funnel internal information from Terraform back to Jane Street. Simultaneously, Bryce facilitated introductions, connecting Terraform's business development lead with the head of Jane Street's "DeFi department." The two sides began regular communications under the guise of "exploring strategic investment cooperation."

From the lawsuit's perspective, Jane Street essentially turned this communication channel into a backdoor for continuously obtaining material non-public information.

Jane and Terraform: A Little-Known History

Rewind a bit further.

The relationship between Jane Street and Terraform didn't start with Bryce Pratt's group chat; it began earlier. In May 2021, during the first de-pegging of UST.

At that time, UST briefly deviated from its dollar peg, causing panic across the Terra ecosystem. To stabilize the situation, Terraform Labs began contacting institutional trading counterparties for large-scale over-the-counter arrangements. Jane Street was one of them.

According to the lawsuit, in this relationship, Terraform provided Jane Street with large trading allocations for UST and Luna, and at certain stages offered discounts or structured incentives in exchange for its liquidity support during critical moments. These terms were never publicly disclosed.

This means the relationship between the two companies was not an ordinary market transaction from the start but a contractual, interest-aligned arrangement. It is precisely this layer of relationship that makes the insider trading allegations harder to dismiss legally. When you have a secret agreement with the other party while simultaneously holding their undisclosed internal information, any trade you make appears highly unusual.

Time moved to early 2022. On the surface, the Terra ecosystem was thriving: the Luna Foundation Guard (LFG) had just been established, absorbing approximately $5.5 billion worth of Luna reserves and purchasing another $3 billion in other assets, presenting an image of an impregnable fortress. However, beneath this veneer, signs were beginning to emerge: deposit pressure was mounting on the Anchor protocol, UST's reliance on the peg was increasing, and LFG's reserve consumption was quietly accelerating.

Not many knew this. But Jane Street happened to be one of them.

10 Minutes: Before the $40 Billion Empire Collapsed

May 7, 2022, Eastern Time, 5:44 p.m.

Terraform quietly withdrew 150 million TerraUSD from the Curve 3pool, a liquidity pool specifically for stablecoin swaps. No announcement, no warning, no public statement.

This operation was completely unknown to the outside world at the time.

However, less than ten minutes after this withdrawal, a wallet tagged by on-chain analysts as associated with Jane Street withdrew 85 million TerraUSD from the same liquidity pool.

The lawsuit further points out that Jane Street's unusual actions did not stop there. Before the UST de-peg became apparent and public panic began to spread, addresses associated with Jane Street had already completed a systematic risk unwinding, massively reducing UST holdings, adjusting related positions, and minimizing net exposure to the Terra ecosystem. Some specific numbers are redacted in the lawsuit, typically indicating trade secrets or evidence not yet public, but the fund flow trajectories tracked by on-chain analysts are sufficient to illustrate the point.

Meanwhile, Terraform and LFG were doing the exact opposite.

On May 7, Terraform bought over 250 million UST. On May 8, it bought another over 200 million. In the following days, cumulative purchases exceeded 1.9 billion UST, plus over 90 million Luna. As for LFG, by May 16, its UST holdings surged from about 700,000 to over 1.8 billion, an increase of over 1.7 billion; Luna holdings skyrocketed from 1.7 million to over 222 million.

Another piece of evidence is a report released by on-chain data analysis firm Nansen on May 27, titled "On-Chain Forensics: Demystifying TerraUSD De-Peg." The report did not directly name Jane Street but detailed several wallets that played key roles during the de-pegging, including one later alleged to be associated with Jane Street. The report's conclusions were two-fold: first, these fund movements occurred before market panic became evident; second, there was a significant time lag between these operations and the publicly visible collapse timeline.

Address suspected to be linked to Jane Street withdrew 85 million TerraUSD

The lawsuit also mentions that after the May 7 trades, Jane Street did not stop. They allegedly continued to use confidential information obtained from Jump Trading to further trade TerraUSD and amplify profits. Jump Trading had previously secretly agreed with Terraform to support the price and ultimately profited billions from the collapse.

In India, They Did the Same Thing

Now, careful researchers have found that after Jane Street was sued by Terra, the 10 a.m. sell-offs disappeared. This seems to further confirm the rumors of the "Jane 10 a.m. Dump Strategy."

On the other side of the world in India, regulators had already formed their own judgment about Jane Street.

The Securities and Exchange Board of India (SEBI) issued a record-breaking penalty of 48.43 billion rupees (approximately $570 million) in a 105-page interim order. This figure is unprecedented in Indian regulatory history, and SEBI's findings read remarkably similar to the allegations in the Terra Luna case.

SEBI believes Jane Street implemented a meticulously designed "pump and dump" strategy in the Indian market.

The logic was this: First, artificially push the Indian Bank Index (BANK NIFTY) up or down through large-scale directional buy/sell orders in the relatively illiquid spot and futures markets. Once the price reached the desired level, immediately execute reverse operations in the highly liquid options market to harvest retail traders following the trend. Finally, systematically dump the previously established spot positions, causing the index to fall back, rendering the options held by retail traders worthless while the value of their own reverse positions soared.

SEBI's report cited a specific example: on January 17, 2024, Jane Street built a long position of approximately $67 million in just 8 minutes. Its trading volume was over three times that of the market's second-largest participant, and this single buy order alone pushed the index up over 1%.

The regulator's wording was blunt, stating Jane Street's actions constituted "trading to influence price, not price to influence trading," forming a "deliberate, well-planned, sinister scheme and artifice" with the sole intent to mislead the market, particularly exploiting the large number of inexperienced retail participants.

For a long time, Jane Street was the archetype of this narrative. The company was known for extreme secrecy, never giving media interviews or boasting to the outside world. It amassed astonishing wealth through quantitative trading and market-making, achieving a near-mythical status within the industry. During recruitment season, the compensation figures it offered drove Wall Street graduates wild, with competition as fierce as any top-tier institution.

However, starting from a certain point, the stories about this company began to grow more complex.

In the Terra Luna case, it was accused of using insider information to exit early, completing its retreat while Terraform and LFG desperately propped up the market with billions.

In the Indian market, it was deemed by regulators to have systematically manipulated spot and derivative prices to harvest ordinary investors.

Alameda Research, the core team that dragged the entire crypto industry into its darkest hour, had many members from Jane Street, and its founder SBF admitted his market thinking framework was learned at Jane Street.

Furthermore, Jane Street is known for aggressively suing former employees, a level of litigiousness rare even on Wall Street.

An earlier investigative report even linked Jane Street to weapon procurement funds in a coup attempt in South Sudan, though details remain disputed.

The market is not a fairy tale. Information is power; information represents hierarchy.

Jane Street's "track record" seems more extensive than we imagined, and its reputation has indeed taken a hit in recent years.

Although the conclusion of Jane Street's lawsuit is not yet final, the fact that one company appears in so many negative stories is itself a signal.