Is a Lawsuit Behind Bitcoin’s Surge Past $68,000?

▲ Bitcoin (BTC)

The virtual asset market, led by Bitcoin (BTC), recovered $170 billion in market capitalization in just one day, breaking the downtrend that had persisted since last October and shifting into a strong rebound phase.

According to crypto-focused media outlet The Crypto Basic on February 26 (local time), the total market capitalization of the cryptocurrency market surged about 8% in a single day on Wednesday, approaching the $2.5 trillion level. Bitcoin, which rose more than 5% to recover to around $68,443, was the key driver of the rebound. Although Bitcoin had fallen below the $65,000 level the previous day, it quickly reversed course, laying the groundwork for a renewed attempt to surpass its all-time high of around $120,000 recorded last October.

Market participants are paying attention to news of a legal lawsuit against major market maker Jane Street as a catalyst for the surge. The liquidator of Terraform Labs has filed a lawsuit alleging that Jane Street used insider information to gain unfair profits during the collapse of Terra-Luna. According to The Wall Street Journal, Jane Street is suspected of having prior knowledge of the downfall of the Terra ecosystem led by Do Kwon and executing trades that had a significant impact on the market.

Shortly after the lawsuit was reported, claims emerged that a specific selling pattern that had been suppressing Bitcoin’s price had disappeared. Investors had long suspected that concentrated selling pressure occurred daily at 10 a.m. EST, with some analysts pointing to Jane Street’s automated selling strategy as the cause. Notably, at 10 a.m. on Wednesday, when the lawsuit became public, prices surged instead of facing selling pressure, lending weight to these claims.

Eric Balchunas, senior ETF analyst at Bloomberg, observed on X (formerly Twitter) that the market was reacting immediately to the disappearance of a dominant source of selling pressure. On-chain analyst Nonzee also suggested that the market’s rules of the game may have changed, citing the sharp rise in Bitcoin’s price at a specific time following the announcement of the legal action. However, experts agree that careful observation is still needed to determine whether this shift can lead to a sustained long-term recovery.

Alongside Bitcoin’s rebound, major altcoins also posted gains. Ethereum (ETH) rose 10% to $2,067, while XRP and BNB climbed 7% and 6.2% to $1.45 and $628.78, respectively. Solana (SOL) increased 8% to $87.75, and Cardano (ADA) surged 12% to $0.2952, marking the most notable gain among them. Meme coins Dogecoin (DOGE) and Shiba Inu (SHIB) also rose 9% and 4.5%, respectively, reflecting the broader risk-on sentiment across the market.

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