Analysis: Market Makers May Unwind Hedging and Short Bitcoin, Potentially Causing Market Volatility on Friday

Liquidity provider Arbelos Markets' trading director Sean McNulty stated: "MicroStrategy announced plans to issue more shares next year to purchase more Bitcoin, which has driven up the price of Bitcoin. The market has a forward-looking attitude toward MicroStrategy's Bitcoin purchases, which is the biggest reason for the market's rise." According to a filing submitted to the U.S. SEC on December 23, MicroStrategy is seeking to increase the authorized number of Class A common stock and preferred stock. So far this year, Bitcoin has risen 135%, outperforming 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 are set to expire on Friday, with the platform's open contract positions exceeding $43 billion, reaching an all-time high. McNulty added: "Market makers may unwind hedging and short Bitcoin, which could lead to volatility in the market on Friday."