Bitcoin’s Volatility Decline

Bitcoin ($BTC) is currently experiencing a notable decrease in volatility. According to data from Glassnode, Bitcoin’s volatility has reached multi-year lows, sparking speculation about significant developments in the near future. The crypto intelligence platform recently shared this downturn in volatility on its official X account.

Current Volatility Statistics

Bitcoin’s 1-week realized volatility has plummeted to 23.42%, approaching historical lows. In the past four years, it has dipped below this level only a few times—specifically in October 2024 (22.88%) and November 2023 (21.35%). Historically, similar reductions in volatility have resulted in substantial market movements.
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> — glassnode (@glassnode) February 21, 2025

Implications of Volatility Collapse

The impressive drop in Bitcoin’s volatility suggests the potential for a significant market change soon. The realized volatility gauge assesses Bitcoin’s price fluctuations over time. When this metric hits such low levels, it usually indicates a market consolidation phase, paving the way for potential breakouts in either direction. Currently, Bitcoin is trading above $80,000, with traders watching closely for signs of a correction or breakout.

Implied Volatility of Bitcoin Options

Alongside realized volatility, Glassnode also reports that the 1-week implied volatility of Bitcoin options has decreased to 37.39%. This marks one of the lowest levels in recent years. The convergence of low implied and realized volatility illustrates a precarious market position, suggesting that this period of calm may not last long.