Market analyst Jeff Park has suggested that long-time Bitcoin
According to his report, early investors and large holders of Bitcoin, often called “whales” or “OGs”, are selling covered calls to earn extra income from their existing BTC.
Selling a covered call means offering someone else the option to buy Bitcoin at a fixed price in the future. The seller earns a fee for doing this.
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Since these Bitcoins are already owned and not newly bought, this activity does not bring new money into the market. Instead, it creates selling pressure because other traders, mainly market makers, often take the opposite side of the deal.
To manage their risk, those market makers sell Bitcoin in the spot market, which tends to push prices lower.
Park explained that this process changes the market balance. The Bitcoin used in these trades has usually been held for many years, so it does not add new liquidity.
Park said, “When you already have the Bitcoin inventory that you’ve had for 10-plus years that you sell calls against it, it is only the call selling that is adding fresh delta to the market, and that direction is negative, you are a net seller of delta when you sell calls”.
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