The Bitcoin market remains boring. Investors chasing yields may be partly to blame
Bitcoin's prolonged range-bound trading since mid-February is partly attributed to investors using covered call strategies to generate extra yield.Summary
The Bitcoin market has been stuck in a narrow trading range centered around $70,000 since mid-February, despite geopolitical support around $65,000 from Iran war concerns. A key factor suppressing price swings appears to be institutional investors systematically selling call options against their spot holdings to harvest premium—a covered call strategy. This activity transfers significant gamma exposure to market makers, forcing them to hedge by buying dips and selling rallies to maintain delta neutrality, which mechanically suppresses volatility and keeps the price range-bound. This effect is evidenced by the decline in Bitcoin's 30-day implied volatility index (BVIV), contrasting with volatility spikes in other asset classes.
(Source：CoinDesk)