Covered Call Selling by Bitcoin Whales Is Weighing on Spot Prices, Analyst Says

Bitcoin’s struggle to regain upside momentum near the $90,000 level may be less about weak demand and more about how large, long-term holders are managing their exposure, according to market analyst Jeff Park.

He argues that widespread covered call selling by Bitcoin “whales” is quietly suppressing spot prices, even as institutional interest through exchange-traded funds remains strong.

Bitcoin OGs Turn to Covered Calls to Generate Yield on Long-Held BTC

Covered calls involve selling call options against Bitcoin already held, allowing sellers to collect premiums while giving buyers the right to purchase BTC at a predetermined price.

Park said this strategy is increasingly favored by long-term holders, often referred to as “OGs,” who accumulated Bitcoin years ago and now use options markets to generate short-term income.

The impact, however, extends beyond the options market. Market makers who buy these call options must hedge their exposure, typically by selling spot Bitcoin.

That hedging activity introduces persistent sell-side pressure, pushing prices lower or capping rallies.

“When you sell calls against Bitcoin you’ve held for more than a decade, the only fresh market exposure comes from the call selling itself,” Park said.

“That exposure is negative, making the seller a net source of downward pressure.”

Because the Bitcoin used to back these options already exists and does not represent new demand, the strategy fails to add fresh liquidity to the market.

Instead, it shifts price influence toward derivatives trading, where options flows increasingly dictate short-term price action.

Park said this dynamic helps explain why Bitcoin has remained choppy despite steady inflows into spot ETFs.

The trend has coincided with Bitcoin’s partial decoupling from US equities in the latter half of 2025. While major stock indices continued to hit record highs, Bitcoin retreated from earlier peaks and hovered near $90,000.

Some analysts had previously pointed to Bitcoin’s correlation with tech stocks, but recent price behavior suggests different forces are now at play.

Analysts Split on Bitcoin’s Next Move as Fed Rate Cuts Loom

Looking ahead, opinions remain divided. Several analysts expect Bitcoin to resume its rally once the US Federal Reserve continues its rate-cutting cycle, which would inject liquidity into financial markets and favor risk assets.

CME Group’s FedWatch tool shows that 24.4% of traders are pricing in another rate cut at the January FOMC meeting.

Others remain cautious. A growing camp warns that if covered call selling persists and macro conditions fail to improve, Bitcoin could revisit lower levels, with some projecting a drop toward $76,000.

Last week, Bitfinex said the market is showing “seller exhaustion” following a period of heavy deleveraging and panic-driven exits by short-term holders.

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