Bitcoin ($BTC) price suppressed by whale covered call strategies... Market maker selling pressure spreads

Analyses have pointed out that long-term holders of Bitcoin (BTC) are using a “covered call” strategy, thereby suppressing the spot market price.

Market analyst Jeff Park diagnosed that whales, i.e., the so-called “OGs” who hold long-term positions, are injecting abnormal selling pressure into the market by selling call options. This strategy involves selling call options that give investors the right to buy the asset at a specific price in the future, while collecting the option premium.

The problem is that market makers who buy these call options hedge their positions by selling Bitcoin spot in the market. It is explained that this leads to a situation where, despite strong demand for Bitcoin among ETF investors in traditional finance, its price rise is limited.

Therefore, long-term holders use options strategies to lock in profits, which is evolving into a structure that constrains short-term price upward momentum. In particular, market makers actively hedge their positions, resulting in a surge of sell orders.

Article summary by TokenPost.ai

🔎 Market Interpretation

Due to the spread of covered call strategies, even if demand to buy Bitcoin (BTC) is strong, the spot price appears to be under pressure. The strategic moves of whales are triggering a short-term downward pressure across the entire market.

💡 Strategy Highlights

Even long-term holders are using covered calls as a means to realize profits, reflecting market trends. However, beyond the premiums received from options, this strategy also involves potential losses, so ordinary investors need to fully understand its volatility and hedging structure.

📘 Terminology Explanation

Covered Call: A strategy of selling call options on an underlying asset that one already owns, collecting premiums as income. If the stock price rises, gains are limited, reducing additional profit potential.

Market Maker: A participant acting as a liquidity provider, offering buy and sell quotes, and adjusting these to ensure smooth trading.

TP AI Notes

This article uses a language model based on TokenPost.ai to generate a summary. The main content of the original article may be omitted or inaccurate.