Bitcoin price today is staging a massive recovery, surging nearly 4% to test the critical $70,000 threshold as markets react to a seismic shift in institutional flows. The sudden bullish momentum on February 26, 2026, comes as reports confirm that Jane Street, a major institutional trading firm, has paused its controversial daily selling strategy following a bombshell lawsuit filed by Terraform Labs' liquidation administrators. The pause in what traders had dubbed the "10 a.m. drop" has sparked a relief rally, triggering over $585 million in short liquidations across the board.
Institutional Sell-Off Stops: The Jane Street Catalyst
The primary driver behind today's aggressive price action is the sudden cessation of consistent selling pressure that has plagued Bitcoin for months. Market analysts have long speculated about a predictable algorithmic sell-off occurring daily around the U.S. market open. That pressure evaporated this morning following news of the Jane Street crypto lawsuit, which alleges the firm profited from insider information during the 2022 Terra-Luna collapse.
According to court filings from Todd Snyder, the administrator for Terraform Labs, Jane Street is accused of "rigging the market" by shorting TerraUSD (UST) based on non-public information just minutes before the collapse. The lawsuit claims a wallet linked to the firm withdrew $85 million from the Curve3pool merely 10 minutes after Terraform Labs secretly removed liquidity. This legal scrutiny appears to have forced the firm to halt its current active trading strategies, effectively removing a massive sell wall that had capped Bitcoin's upside.
BTC $70k Resistance and Short Squeeze Mechanics
With the selling pressure lifted, bulls have wasted no time pushing the asset toward the BTC $70k resistance level. The rapid ascent caught short sellers off guard, leading to a cascade of buy orders as traders scrambled to cover their positions. Data from Coinglass indicates that Bitcoin short liquidation news is dominating the headlines, with over $320 million in Bitcoin shorts wiped out in the last 24 hours alone.
"The market structure has flipped overnight," noted a senior analyst at K33 Research. "Without that persistent institutional sell pressure, the path of least resistance is significantly higher. We are seeing a classic short squeeze that could propel BTC back toward the $75,000 range if the $70k level flips to support."
Solana and Ethereum Join the Rally
The optimism isn't limited to Bitcoin. The broader crypto market rebound 2026 is in full swing, with altcoins posting double-digit gains. Solana (SOL) is outperforming many peers, driven by sustained spot Solana ETF inflows. Since their approval in late 2025, these ETFs have absorbed significant capital, and the renewed risk-on sentiment is accelerating that trend. Ethereum (ETH) has also reclaimed key psychological levels, trading up 6% as decentralized finance (DeFi) activity spikes in response to the market's newfound volatility.
Crypto Options Expiry February 2026: The Next Hurdle
While the mood is jubilant, traders are eyeing the upcoming crypto options expiry February 2026 this Friday as the next major volatility event. Billions of dollars in Bitcoin and Ethereum options are set to expire, and the sudden price jump has shifted the "max pain" price points significantly higher.
If Bitcoin can maintain its footing above $68,500 through the expiry, analysts believe it could confirm a trend reversal, setting the stage for a march back toward the all-time highs of $126,000 seen late last year. However, failure to break the $70,000 ceiling could see the price consolidate as the market digests the full implications of the Jane Street litigation.
What This Means for Investors
The halting of the alleged institutional sell-off marks a potential turning point for the 2026 market cycle. For retail and institutional investors alike, the focus is now on whether this legal development will lead to cleaner market mechanics and sustained organic growth. As the industry watches the courtroom drama unfold, the charts are painting a picture of a market ready to leave the shadows of 2022 behind.
