Nick Szabo Calls Out Wall Street: Bitcoin ETF Fiasco Exposes Deep Market Flaws

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The scandal surrounding Jane Street, the trading firm accused of manipulating the crypto market like a kid with a slingshot in a china shop, has escalated faster than a toddler in a toy store. Enter Nick Szabo, the cryptography pioneer who’s seen enough to know what’s really going on with Bitcoin ETFs. In a recent post, Szabo called out the real risks-because apparently, trusting Wall Street with your crypto is like handing a fox the keys to the henhouse.

Szabo’s thoughts boil down to this: Bitcoin ETFs have made a massive mistake by trusting market-makers like Jane Street, who might as well be betting against their own clients. Surprise, surprise, money is flowing out of ETFs and back into Bitcoin itself, because people are realizing it’s not Bitcoin they’ve lost trust in-it’s the sleazy antics of Wall Street. Who would’ve thought, right?

“Not your keys, not your coin”: Nick Szabo

Szabo’s words are backed up by cold, hard data from SoSoValue. U.S. spot Bitcoin ETFs have bled $179 million since February, and the drain’s been ongoing since November 2025. In the four months since, more than $6 billion has flowed out-over 10% of all inflows since these ETFs were born. It’s almost like someone’s been siphoning gas from a very expensive car.

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Szabo didn’t mince words-he echoed the mantra: “Not your keys, not your coins.” If you’re putting your faith in intermediaries like Jane Street, you’re essentially making a very bad security bet. While the market gave a standing ovation for the institutional arrival, Szabo saw only the return of the same old problems from traditional finance that Bitcoin was supposed to fix. Great, right?

And for a bit of irony, Szabo pointed to Jane Street’s involvement in the downfall of the algorithmic stablecoin UST and the token LUNA as a stroke of “natural selection.” According to him, the collapse of this “Jenga tower” was exactly what needed to happen. If a protocol can’t stand up to a little pressure, then, well, maybe it shouldn’t be standing at all.

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2026-02-27 14:10