Crypto Volatility Hits Record Low

The volatility of Bitcoin and Ether has reached record lows, according to data from crypto derivatives analytics platform Greeks Live. The Deribit Implied Volatility Index (DVOL), which measures the expected volatility of a crypto asset over the next 30 days, has fallen to 37% for both Bitcoin and Ether. This is the lowest level for the DVOL since 2021.

The decline in volatility suggests that derivatives traders are not expecting any major moves in crypto markets in the near term. This is likely due to a number of factors, including the ongoing bear market, the recent collapse of TerraUSD, and the ongoing regulatory uncertainty surrounding cryptocurrencies.

Other analysts have also noted the decline in volatility in crypto markets. Crypto analyst Josh Olszewicz observed that Bitcoin’s weekly Bollinger Bands have contracted to record levels. Bollinger Bands are a type of statistical chart that characterizes asset prices and volatility over time. The fact that Bitcoin’s Bollinger Bands have contracted so much suggests that the price of Bitcoin has been very rangebound in recent weeks.

The decline in volatility in crypto markets is likely to be a welcome relief to many investors. However, it is important to remember that volatility can be a sign of underlying strength in a market. If volatility does start to pick up again, it could be a sign that the crypto market is ready to move higher.