Bitcoin (Bitcoin) Price volatility has risen over the past two months, indicating a potential return to options-driven price action that sparks significant market moves in both directions.
Bitcoin’s implied volatility never exceeded 80% after Bitcoin ETFs were approved in the US, According to By Jeff Park, market analyst and advisor at investment firm Bitwise.
However, the chart shared by Park shows that Bitcoin’s volatility is back at around 60 at the time of this writing.
Park cited Bitcoin’s explosive price movement in January 2021, which… The 2021 bull run has begun This took BTC to all-time highs and cycle highs of $69,000 in November of that year, as the last major options-driven collapse. He said:
“Ultimately, it is options positioning, not just spot flows, that is creating the decisive moves that carry Bitcoin to new highs. And likely for the first time in nearly two years, the volatility surface is flickering with early signs that Bitcoin may become options-driven again.”
The analysis contradicts the theory that the presence of ETFs and institutional investors has permanently dampened Bitcoin price volatility. Market structure transformation To reflect a more mature asset class, supported by passive flows from investment vehicles.
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Volatility is rising amid the market carnage, raising fears of an extended downturn
High volatility in the BTC market is Consistent with levels across all asset classesAccording to Binance CEO Richard Teng.
Bitcoin It crashed for less than $85,000 on Thursday, raising fears of further declines in the coming weeks and perhaps The next Bitcoin bear market has begun.
Analysts have offered several theories about the causes of the downturn, including the liquidation of highly leveraged positions in derivatives markets and Bitcoin. Long term holders cash outand macroeconomic pressures.
The ongoing deflation of BTC is Due to short-term factors It points to a “tactical rebalancing,” rather than institutional flight or lack of demand, according to analysts at cryptocurrency exchange Bitfinex.
This does not derail Bitcoin’s long-term fundamentals, price appreciation, or institutional adoption trends, analysts said.
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