Covered Call Selling by Bitcoin Whales Impacting Spot Prices, Analyst Reports

Market analyst Jeff Park suggests that Bitcoin's difficulty in breaking past the $90,000 mark is not primarily due to a lack of demand. Instead, it reflects the trading strategies of large, long-term holders who are managing their investments through covered call selling. This strategy has been impacting Bitcoin's spot prices by creating persistent selling pressure in the market.

Key Takeaways:

The recent stagnation of Bitcoin prices around $90,000 is mainly attributed to covered call selling by long-term holders, rather than weak demand from buyers.
Market makers who hedge these options by selling Bitcoin contribute to consistent selling pressure, which limits price surges.
The activity within the options market is increasingly influencing Bitcoin's short-term price movements, despite significant investment inflows into exchange-traded funds (ETFs).

Park points out that the actions of Bitcoin "whales," or large holders, engaging in covered call selling are subtly affecting Bitcoin's spot prices, even as institutional interest through ETFs remains robust.

Covered Call Selling by Bitcoin Whales Is Weighing on Spot Prices, Analyst Says

Understanding Covered Calls and Their Effect on Bitcoin's Price

Covered calls entail the sale of call options against Bitcoin that investors already own, enabling them to collect premiums while granting buyers the option to purchase Bitcoin at a specific price.

According to Park, this strategy is gaining traction among long-term holders, often referred to as “OGs,” who bought Bitcoin years ago. They are now utilizing options to generate short-term income.

However, the implications extend beyond the options market. Market makers who purchase these call options must hedge their risk, usually by selling spot Bitcoin. This hedging creates ongoing selling pressure, which can drive prices down or hinder upward movements.

“When you sell calls against Bitcoin you’ve held for more than a decade, the only new market exposure comes from the call selling itself,” Park explains. “That exposure is negative, making the seller a net source of downward pressure.”

Since the Bitcoin backing these options isn’t new demand, the strategy does not create additional liquidity in the market. Instead, it redirects price influence towards derivative trading, where options activities increasingly determine short-term price movements.

Park suggests that this dynamic may help clarify why Bitcoin’s price has remained volatile, despite ongoing investments into spot ETFs.

This trend has emerged alongside Bitcoin’s partial separation from U.S. equities in the latter half of 2025. Whereas major stock indices have been reaching record highs, Bitcoin has been unable to maintain its previous peaks and is now floating around the $90,000 mark.

While some analysts had highlighted Bitcoin's correlation with tech stocks, recent price behavior implies that different factors are influencing Bitcoin's trajectory.

Future Outlook: Diverging Opinions on Bitcoin's Path

As for what lies ahead, opinions among analysts are mixed. Some speculate that Bitcoin may regain its upward momentum following further interest rate cuts by the U.S. Federal Reserve, which could inject liquidity into the financial sector and benefit risk assets.

According to CME Group’s FedWatch tool, around 24.4% of traders anticipate another interest rate cut at the upcoming January FOMC meeting.

Conversely, others express caution. A growing number of analysts warn that if the trend of covered call selling persists and macroeconomic conditions do not improve, Bitcoin may fall to lower levels, with projections suggesting a dip towards $76,000.

Last week, Bitfinex commented that the market is experiencing “seller exhaustion” following a phase of aggressive deleveraging and panic-driven exits by short-term holders.