Business & Economics
Bitcoin Drops to $85K Amid Whale Covered-Call Wave and Carry-Trade Unwind
On 15 Dec 2025 BTC slid from ~$90K to $85K as option-selling ‘OG’ whales forced market-maker hedging while looming Bank of Japan tightening yanked liquidity and triggered a cascade of $200 M long liquidations.
Focusing Facts
- Market maker Wintermute offloaded an estimated $1.5 billion in BTC during thin weekend trading, magnifying the decline.
- Roughly $200 million of leveraged long positions were liquidated within hours once Bitcoin breached $90,000.
- About 60 % of spot-ETF inflows—roughly $100 billion—now sit at an unrealized loss with an aggregate cost basis near $80,000.
Context
The episode echoes the 1998 yen-carry unwind, when BOJ tightening forced global de-risking, and resembles the March 2020 oil ‘gamma squeeze’ where option dealers’ hedges drove spot prices. Structurally, it spotlights two long-term forces: (1) derivatives are overtaking spot flows as price setters—much as S&P 500 futures did in the 1987 crash—and (2) Japan’s monetary pivots still steer world liquidity despite a decade of U.S.-centric narratives. Whether this matters a century from now will hinge on if Bitcoin can absorb institutional option yield strategies without repeating commodity-like boom-bust cycles; today’s stress tests the thesis that ETFs and treasuries provide a floor, but history shows—gold in 1980, dot-com stocks in 2001—that new financial rails can as easily transmit volatility as dampen it.
Perspectives
Bitcoin-bullish crypto outlets
Bitcoin-bullish crypto outlets — They argue the pullback is only temporary and see Bitcoin poised to resume its up-trend toward $140,000 on the back of rising global liquidity and record-setting institutional ETF inflows. Coverage spotlights upside models and adoption data that inspire optimism and trading engagement while skimming over liquidity stresses and downside technical levels.
Macro-bearish analysts and data firms
Macro-bearish analysts and data firms — They warn that tightening global monetary policy, underwater ETF positions and miner margin strain signal a deeper slide that could take Bitcoin below $70,000. Reports accentuate loss metrics and negative macro linkages that heighten fear and readership during stress events, potentially overstating worst-case outcomes.
Market-structure commentators
Market-structure commentators — They attribute Bitcoin’s listless price to internal factors such as whales’ covered-call selling and a sharp decoupling from equities, suggesting demand is unchanged but short-term flow dynamics are suppressing rallies. By focusing on derivative flows and correlation shifts, they may underplay broader economic drivers, catering to traders who favor microstructure explanations over macro fundamentals.