The 26-year-old has been lauded as one of the Premier League's best signings this season after hitting 16 goals in 28 games since moving from Rayo Vallecano last summer.
He was recently rewarded for his fine form with a new £30,000-per-week contract that will run until 2016.
Despite tying him down to a longer deal, the Welsh club are believed to be bracing themselves for big-money offers when the transfer window reopens in July.
"The club wanted to reward Michu, but also protect themselves," a club insider told The Mirror.
"There are still big fears Michu will leave at the end of the season. But at least the club is now guaranteed a big fee and will be in a good negotiating position when bids come in."
Michu was overlooked for selection in Spain's squad for their friendly with Uruguay.