Matrixport: Bitcoin Gamma Liquidation, Liquidity Still Lacking

Deep Tide TechFlow News, February 27 — Matrixport reports that “This week, Bitcoin has shown little significant volatility, which in itself indicates that the current moment is more worth paying attention to. Beneath the calm surface, market structure is quietly changing. Approximately $2.5 billion in gamma exposure is about to expire, and since the peak, $26.7 billion has been withdrawn from the market. Overall positions are also approaching a reset. The main factors influencing future trends may gradually shift from options mechanisms to liquidity itself.

In this report, we will focus on three points: whether this recent rebound is misleading and sufficient to constitute a trend reversal; where the passive hedging pressure will mainly concentrate after options expiration; and what conditions the market needs to meet to support a more sustainable stabilization. Perhaps, the most noteworthy phase of this cycle has just begun.

Currently, Bitcoin’s price is roughly unchanged from a week ago, but the trend is not stable. The previous rapid decline, followed by an equally swift rebound, is largely related to options position structures. Market makers have maintained a short gamma position. As the price declines, they are forced to sell futures to hedge their exposure, which mechanistically amplifies the downward movement and accelerates the price toward $63,000.”