Markus Thielen says Wall Street has curbed Bitcoin’s biggest rallies

Markus Thielen’s Bitcoin rallies thesis is that Wall Street’s growing role has made the cryptocurrency’s old pattern of consecutive double-digit gains less common. For investors, the key distinction is that this is an analyst’s interpretation of market structure, not independently established proof that institutional trading has permanently changed Bitcoin’s behavior.

Thielen, founder of 10x Research, said in a Cointelegraph interview published Nov. 3 that institutional traders sell call options after Bitcoin rallies and that profit-taking by large holders also affects the market. In his view, those forces have reduced the frequency of the sharp upside moves seen in earlier Bitcoin cycles.

He expects Bitcoin to respond quickly to major economic news, then trade sideways until the next macroeconomic catalyst. Thielen said Wall Street participants are particularly focused on economic data and Federal Reserve decisions.

Why does Markus Thielen think Bitcoin rallies have changed?

Thielen attributes the change partly to institutional traders selling call options following rallies. He did not present evidence in the interview establishing that options activity caused a structural fall in Bitcoin volatility. His point is that the way more professional investors trade Bitcoin may differ from the conditions behind earlier rapid price jumps.

The broader implication for readers is limited: a market can still move sharply in either direction, even if one analyst believes its rally pattern has changed. Thielen’s comments describe his reading of the market rather than a confirmed rule for Bitcoin prices.

How much spot Bitcoin ETF demand is directional?

Thielen estimated that market makers could account for as much as half of the $60 billion in net U.S. spot Bitcoin ETF inflows he reviewed. He said those firms may hold ETF shares to hedge options trades, meaning the holdings may not reflect a straightforward expectation that Bitcoin will rise.

That estimate should not be read as meaning half of all ETF flows are hedging activity. It is Thielen’s analysis, based in part on Form 13F disclosures. The Securities and Exchange Commission says eligible investment managers report specified securities holdings each quarter on Form 13F, with filings due within 45 days after quarter-end. The reports show quarter-end positions and market values, not an investor’s motive, intraperiod options exposure or real-time ETF flows.

That reporting delay and lack of trading-intent detail mean Form 13F data alone cannot settle whether a particular ETF position is a hedge or a directional Bitcoin investment. Investors can review the SEC’s Form 13F guidance for the scope of the disclosures.

What is Thielen’s Bitcoin outlook?

Thielen said Bitcoin could reach $90,000 by year-end, although he also allowed for a decline into the mid-to-high $70,000s first. He tied that view partly to his expectations for Federal Reserve policy, including another rate increase by December followed by a more restrained pace of increases.

He also said he expects Bitcoin to outperform Ether. His Ether view is that Ethereum needs a clearer connection between use of its network and financial benefit for ETH holders, according to Cointelegraph.

The interview offers a framework for assessing ETF holdings and options activity, but its central conclusions remain Thielen’s market views and price outlooks.

This story draws on original reporting from Cointelegraph.