Bitcoin price rapidly approached the $60,000 threshold, driven by record outflows from spot ETFs. Analysts state that this level has been watched as an important support for a long time, and a downward break may increase the selling pressure.
Why is the 60 thousand dollar level being watched?
According to Jean-David Péquignot, chief commercial officer of crypto options exchange Deribit, the $60,000 level is not only a psychological threshold, but also a limit that may have structural consequences for institutional investors and derivatives market participants. Deribit is among the major trading platforms that stand out in crypto asset derivatives.
Péquignot stated that in the last year, a significant part of the institutional capital consisting of ETF buyers, large investors and short-term speculators bought Bitcoin between 60 thousand and 67 thousand dollars. The decline of the largest cryptocurrency to this band again led these investors to approach the cost level.
Jean-David Péquignot stated that losses on paper could grow if the price falls below the cost of investors, which could increase the opportunity cost of holding Bitcoin, especially while the strong rise in artificial intelligence stocks continues.
It is considered that if the price falls below this level, the tendency to close positions before the loss grows may come to the fore. According to the opinion expressed in the news, the sharp rise seen in traditional markets, especially in artificial intelligence-related stocks, may have accelerated the shift of capital from crypto assets to other areas.
Pressure may increase in the options market
According to Deribit data, there is an open position of over $1.2 billion in put options with a strike price of $60,000. These contracts gain value when the Bitcoin price falls below this level and are used by investors to hedge against a longer-term decline.
Mini dictionary: Short gamma is when market makers become more sensitive to price movement. As the price approaches a certain level, they may need to buy or sell more in the spot market or futures to maintain balance.
However, the market makers on the other side of these transactions are net sellers of these put options. Péquignot said that in practice this means a short gamma position, as Bitcoin approaches $60,000, these institutions may have to sell spot Bitcoin or futures contracts to offset their risks. This type of hedging can turn an orderly pullback into a harsher and more disorderly selling wave.
Deribit manager emphasized that leveraged long positions are still high in the system, and that falling below 60 thousand dollars could quickly disrupt the collateral indicators and trigger the automatic liquidation chain.
Leveraged positions pose additional risk
According to the news, billions of dollars of leveraged long positions in Bitcoin and other tokens have already been liquidated this week. However, leverage in the market has not been completely cleared. Therefore, a possible move below $60,000 is expected to further strengthen the downward momentum with new liquidations.
On the other hand, Strategy’s chairman of the board, Michael Saylor, partly attributed the recent losses in Bitcoin to capital rotation. The general picture in the market indicates that the $60,000 level may become even more critical in the short term if ETF outflows, option-based hedging transactions and leveraged position resolutions come into play at the same time.
