On February 12, 10X Research CEO Markus Thielen stated at the Consensus Hong Kong conference:
"Following the November 2024 election, Bitcoin surged from $70,000 to $90,000 in just 10 to 12 days. During this period, trading activity was extremely sparse, creating a huge gap, a liquidity vacuum."
So when Bitcoin fell back to $87,000, it fell into this liquidity trap. What happened next was that a large number of negative option gammas appeared at the $75,000 level. This meant that market makers had to hedge and could only keep selling futures.
With the last wave of negative gamma shock absorbed at $60,000, the situation became—"Okay, the last market maker has completed hedging, now we can reverse."
