Exactly this. The "law of supply and demand" is like the ideal gas law: it is a useful model, but it has certain key assumptions. And just as the ideal gas law breaks down in extreme conditions, supply and demand does not hold without certain invariants.
The farther actors are from perfect information, the more asymmetry in the system there is, the slower the system is to react, the more the relationship between supply and demand breaks down.
The farther actors are from perfect information, the more asymmetry in the system there is, the slower the system is to react, the more the relationship between supply and demand breaks down.