During a recent appearance on the “What Bitcoin Did” podcast, Galaxy research Alex Thorn rejected the idea that the price of Bitcoin crashed due to the shenanigans of infamous quantitative trading firm Jane Street.
At the same time, he thinks that Wall Street negativity on Bitcoin is “real but wrong.”
“Twitter cope”
Following the Terraform lawsuit, which accuses the New York-headquartered firm of insider trading, Bitcoiners found a new villain.
They started alleging that Jane Street was behind the 2022 cryptocurrency winter. Some even went as far as assuming that the trading giant is the reason why the price of Bitcoin is currently not at $150,000.
Some alleged that the firm, which acts as an authorized participant for spot Bitcoin ETFs, was running an algorithm that would constantly suppress the price of Bitcoin. Some noticed that the price of BTC would constantly drop around 10 AM ET (U.S. stock market open).
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Bitwise advisor Jeff Park recently stated that a specific regulatory loophole would give Jane Street a unique advantage that would make it possible to manufacture short ETF shares at will.
However, multiple theories dismissed the theory as unfounded, and Thorn is in their camp.
Thorn has stated that the recent conspiracy theory is just “straight-up Twitter cope” and “a manufactured” controversy.
“There’s, you know, a market making firm, a quant trading firm, they’re very often, you know, in a trade like this, most commonly they’re probably trading it neutral, delta neutral. So they’re doing the basis trade or some kind of arbitrage or hedge, right?… So, what is what do we think the actual incentive would be for them to suppress the price?” Thorn said during the podcast appearance.