Bitcoin, hailed as the most reflexive asset, is experiencing unprecedented price movements due to recent developments. The approval of Bitcoin exchange-traded fund (ETF) options by the U.S. Securities and Exchange Commission has amplified its price reflexivity. These ETFs, launched by giants like BlackRock and Fidelity, attracted record-breaking inflows of $3 billion each within their first month.

The introduction of options trading on these ETFs adds a new dynamic: gamma squeezes. This feedback loop forces option sellers to buy more Bitcoin as prices rise, further driving demand and amplifying price volatility. Bitcoin’s finite supply, combined with these market mechanics, creates “reflexivity squared,” propelling its value to new heights. While this marks an era of heightened opportunities, it also reintroduces significant volatility to the market. Show Less