A November filing details market maker firm Jane Street and Susquehanna taking positions in Bitcoin miner-turned-neocloud IREN prior to the October price run, according to purchases made before September 30. Jane Street held a 6.7% position while Susquehanna held a 7% percentage.
As of September 30, Susquehanna owned 20,078,286 shares of IREN. If the market maker still holds the position, it would make the capital markets firm the largest shareholder of the fledgling neocloud.
The disclosure covers activity completed before September 30, making it a lagging indicator of interest. Reporting standards with the SEC do not require companies to report holdings in real time, but future filings will indicate if they still hold these shares.
IREN has fallen some 30% since mid-October, consistent with declines across other publicly traded bitcoin miners.
As market makers, Jane Street and Susquehanna use a combination of call options, put options, and the underlying shares to hedge risk and manage inventory while quoting continuous buy and sell prices. Their profit driver comes from providing liquidity while mitigating exposure to customer order flow.
High stock volatility can increase potential profits for a market maker because it can allow wider bid-ask spreads and higher trading volumes. Market makers earn from the spread between quoted buy and sell prices. Historically, Jane Street and other market makers have jumped on Bitcoin-related equities during run ups in share prices to arbitrage spreads.
Jane Street also adjusted its IREN position several times this year. The firm first reported 11,797,987 shares in February. It reduced the stake to 5,196,304 shares in May, raised it to 12,560,931 in July, and increased it again to 17,465,660 in the latest report.
The disclosures were released during a broad pullback across the bitcoin mining stocks, and as of publication, IREN has dropped 27% over the last five days.
