Analysis: Crypto market makers may unwind hedges, potentially leading to market volatility on Friday

Sean McNulty, trading director at liquidity provider Arbelos Markets, stated, 'MicroStrategy's announcement of issuing more shares next year to purchase more Bitcoin has driven up the price of Bitcoin. The market has a forward-looking attitude towards MicroStrategy's Bitcoin purchases, which is the biggest reason for the market rally.'
According to documents submitted to the US SEC on December 23, MicroStrategy is seeking to increase the authorized shares of Class A common stock and preferred stock.
So far this year, Bitcoin has risen 135%, surpassing returns from traditional investments like global stocks and gold.
Additionally, Bitcoin options with a notional value of $13.95 billion and Ethereum options worth $3.77 billion on Deribit will expire and settle on Friday, with the platform's open contract positions exceeding $43 billion, setting a new record. McNulty added, 'Market makers may unwind hedges, which could lead to market volatility on Friday.' (Bloomberg)