Here's how 'invisible hands' likely accelerated bitcoin's crash to $60,000
Market makers' hedging activities, specifically being 'short gamma,' likely accelerated Bitcoin's drop from $77,000 to $60,000.Summary
While macro forces were blamed for Bitcoin's recent plunge to nearly $60,000, market makers—the dealers who provide liquidity—likely accelerated the crash between February 4th and 7th. According to Markus Thielen of 10x Research, options market makers were "short gamma" between $60,000 and $75,000, meaning they lacked sufficient hedges for their short options positions. As Bitcoin fell below $75,000, these dealers were forced to sell BTC in the spot or futures markets to rebalance their hedges, injecting extra selling pressure. This created a self-feeding cycle where falling prices forced dealers to sell more, amplifying the decline. Thielen noted that approximately $1.5 billion in negative options gamma in that range was critical to accelerating the decline, which reversed sharply once the final gamma cluster near $60,000 was absorbed. This dynamic mirrors traditional markets where market makers can amplify volatility.
(Source：CoinDesk)