Summary
Dealers have a significant impact on Bitcoin’s price during expiry events due to their gamma positioning. With dealers short $50 million of gamma, volatility around the $70,000 strike price will increase as they are forced to hedge their positions. This will lead to choppy price movements around the $70,000 level.
Key Points
1. Dealers are short $50 million of gamma, with the majority focused around the $70,000 strike.
2. The forced hedging due to the large gamma position will exacerbate volatility around the $70,000 level.
3. This will lead to choppy and volatile price movements on either side of $70,000 as we near expiry.