Could a Non-Crypto Hedge Fund Have Pulled a Bitcoin ‘Big Short'?
Episode publishedPodcast: UnchainedUnchained
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I literally think this time around, it's the massive growth in Bitcoin derivatives and a giant fund taking advantage of it. It's actually a pretty simple story. There's some complexities there, but I kinda think that's all that happened here. And it has nothing to do with, you know, the Bitcoin halving or the market just deciding it's time to go down.
Today's topic is the crypto market meltdown of February 5 and whether or not it relates to 10/10. Here to discuss is Parker White, COO and chief investment officer at DeFi Development Corp. Welcome Parker.
Thanks for having me, Laura.
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Yeah, so, you know, looking at that move, obviously that was outsized. And whenever you see something that's, you know, that off the charts, that abnormal, that's typically the place to start the investigation on what went wrong. So we looked at, you know, spot Bitcoin, even the perps, and the volumes weren't off the charts. It was in IBET. And so that's where, you know, some of the guys over here at DFDV, we started looking into it and kind of came up with this theory that it was actually due to the options market on iBit, which have become the fourth largest options market in the world, only
So and and another piece of it was that you thought maybe they're based in Hong Kong. So talk a little bit about those pieces of the hypothesis, because you have a number of observations that you've made about Asian traders, about some of the other things that have been happening in markets that aren't either related to crypto. But now, of course, because crypto is just becoming part of the broader markets that there can be connections there. So talk about what led you to that piece of it, a non crypto hedge fund in Hong Kong potentially being, you know, what's behind this big price drop?
Yeah. So, you know, we've been racking our brains like everybody else over the last four months. Like, what is going on? Crypto is deep hugging from global risk assets. Everything's ripping. Metals are ripping, which is like the debasement trade. Like, this is supposed to be Bitcoin.
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