Bitcoin Pushes Toward $115K, But Market Makers’ Hedging Could Temper the Rally
Bitcoin (BTC) extended its rally past $111,000 early Thursday, reaching new highs driven largely by institutional investors. Yet, experts warn that a subtle but powerful force—the hedging activity of options market makers—may slow the cryptocurrency’s advance near the critical $115,000 threshold.
BTC climbed about 3.5% to $111,878 during Asian trading, as reported by CoinGecko. Alexander S. Blume, CEO of Two Prime, explains that over-the-counter (OTC) supply constraints—fueled by corporate treasury acquisitions—are pushing prices upward, even if traditional exchange volumes don’t reflect the full picture.
“Corporate and sovereign demand off-exchange is intensifying, creating tighter liquidity conditions,” Blume noted. “This could lead to more pronounced price swings as new buyers compete for limited supply.”
Ryan Lee, chief analyst at Bitget, anticipates Bitcoin reaching as high as $180,000 by year-end, supported by strong ETF inflows, reduced supply post-halving, and growing institutional interest.
“The recent downgrade of the U.S. credit rating by Moody’s is reviving interest in BTC and ETH as inflation and fiat-hedging tools,” Lee said. “Bitcoin’s resilience above $103,000 amid turbulent markets highlights its emerging status as a strategic reserve asset.”
Options Market Makers May Create Resistance at $115K
However, Jeff Anderson, head of Asia at STS Digital, cautions that options market makers—who provide liquidity by taking the opposite side of trades—could exert downward pressure on BTC as it nears $115,000. This is due to their hedging requirements tied to “positive gamma” exposure in options contracts.
Data from Deribit options, tracked by Amberdata, indicates significant dealer gamma from $115,000 to $150,000 strike prices. Positive gamma means dealers’ hedges require selling more BTC as prices climb, effectively acting as a brake on sharp gains.
“There’s a large amount of call overwriting in this range, so dealers will be cautious,” Anderson explained. “If Bitcoin breaks through the gamma zone at $115,000, the next leg up could be explosive.”
