BTC Options: Implied volatility in free-fall

The options market has seen sharply declining implied volatility in recent weeks. The short-term implied volatility is now at its lowest level since 2020.
Source: NYDIG

Implied volatility (IV) is a metric derived from options illustrating the investor expectations of future price volatility over a given period. High implied volatility indicates that the market expects price volatility to be high onwards and vice versa.

However, implied volatility alsoillustrates the options premium. Declining implied volatility could be caused by lower demand for directional options bets in general.





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