Bitcoin Facing Greater Price Volatility Than Ether in Q3, Options Market Data Suggests

Bitcoin Facing Greater Price Volatility Than Ether in Q3, Options Market Data Suggests


Bitcoin may seem to be more volatile than traditional assets but in crypto markets it is considered relatively stable compared to alternative cryptocurrencies. 

Bitcoin (BTC) is the biggest cryptocurrency by market value. Not only is it used as the base currency of choice for trading smaller digital assets, it is also less vulnerable to manipulation or sudden price swings compared to altcoins, most of which are based on Ethereum’s blockchain.

However, that pricing situation may change during the third quarter, according to options market data. 

The spread between the three-month at-the-money implied volatility for Ethereum’s ether (ETH) token and bitcoin pair, a measure of expected volatility between the two, fell to a record low of -2.4% on Sunday, according to data provided by the crypto derivatives research firm Skew

Ether-bitcoin three-month volatility spreadSource: Skew

“The negative spread shows the options market expects bitcoin to be more volatile than ether over the next three months,” said Skew CEO Emmanuel Goh. 

The spread clocked a record high of 33% in February and has been on a declining trend ever since. 

See also: Bitcoin Closes in the Green Sunday to End Longest Daily Losing Run in 6 Months

Implied volatility, which is computed using the prices of options and underlying assets and other key metrics, represents investors’ expectations of how volatile or risky an asset would be over a specific period. Implied volatility is a way to quantify uncertainty

“The fact

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