Bitcoin’s recent slide has reignited a familiar pattern in crypto markets: when prices fall sharply, speculation quickly turns toward culprits.
This time, fingers have pointed at Jane Street, Binance, Wintermute, and even unnamed macro hedge funds allegedly dumping BTC at specific hours of U.S. trading.
But a closer look at Bitcoin’s price structure tells a far less dramatic — and far more consistent — story.
The Bitcoin sell-off began long before February
Bitcoin’s decline did not start with a single event or headline. After topping out in the fourth quarter, price action shifted into a prolonged period of lower highs and choppy consolidation.
That phase, visible well before February’s sharp leg down, is typically associated with distribution, not panic.
Large holders appeared to be reducing exposure gradually rather than exiting all at once. That process often involves a mix of spot selling, leverage reduction, and options strategies such as writing calls — none of which show up as a single “dump” on the chart.
By the time Bitcoin accelerated lower into the low-$60,000 range, much of the damage had already been done.
February’s drop was forced, not coordinated
The steep sell-off in February coincided with a spike in trading volume and volatility, hallmarks of forced selling rather than controlled liquidation.
Source: TradingView
Liquidation cascades, margin calls, and volatility-driven de-risking tend to compress into short timeframes once price breaks key support levels.
If a single firm or market maker were responsible, price action would likely have appeared smoother and more contained.
Instead, the move lower was sharp, disorderly, and accompanied by heavy volume near the lows — a pattern more consistent with capitulation than manipulation.
Why conspiracy theories keep resurfacing
Narratives about Jane Street and other large firms have gained traction, partly due to recent legal and regulatory developments. This includes renewed scrutiny of trading behavior during past market collapses.
These concerns have bled into broader market psychology, especially after prior crashes where billions were wiped out in a matter of hours.
However, correlation does not equal causation. The current drawdown unfolded over months, not minutes, weakening the case for a single actor driving the move.
As Matt Hougan, chief investment officer at Bitwise Invest, noted in a recent commentary, the explanation is ultimately far less sensational: investors who were long Bitcoin sold their exposure for a range of reasons, from cycle timing and macro uncertainty to reallocating capital elsewhere.
A cycle-driven reset, not a structural break
Historically, Bitcoin has experienced deep drawdowns during mid-cycle resets without undermining its longer-term trajectory.
The roughly 45% peak-to-trough decline fits within that historical context, particularly following a period of heavy leverage and crowded positioning.
Importantly, selling pressure appears to be slowing. Recent price stabilization suggests that much of the forced unwinding may already be behind the market, even as sentiment remains fragile.
That does not guarantee an immediate rebound — but it does argue against the idea that a single institution engineered Bitcoin’s decline.
Final Summary
- Bitcoin’s drawdown reflects a broad de-risking cycle rather than coordinated manipulation by any one firm or exchange.
- As selling pressure fades, the focus is likely to shift from assigning blame to assessing where the market stabilizes next.