So Squeezers are rooting for #3 but not very orderly. Some yell "To $100k! It's not about the money" and others take their profits.
This will inevitably lead to either the intermediaries and regulators resolving the dilemma or in the case of Shorters going bankrupt, in years of legal battle over the remains.
As Sun Tzu said: "When you surround an army, leave an outlet free."
Wouldn't it be wiser to define a clear goal that allows the Shorters to get out by paying the Squeezers accordingly? Block the easy way out with limit buys above $100 but get all on limit sells at $1000. This is the "way out" for the Shorters but at a terrible price:
* precedence: Other over-leveraged shorters will tremble as they already do a bit
* Squeezers get massive capital from Shorters
* Shorters end up holding
Bitcoin Maston Instance