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Bitcoin Option implied volatility has fallen to low levels; analysts say this may signal significant volatility
Svmuu News: Murphy noted that implied volatility for Bitcoin options is currently extremely low, with 1-week IV at 33% and 1-month IV at 34%—both below the historical 40% range—which may signal significant market volatility ahead.Murphy noted that similar situations have occurred twice in the past year: 15 days after IV fell below 40% in early January, BTC dropped from $97,000 to $62,000;14 days after IV fell below 40% in late April, BTC dropped from $82,000 to $60,000; and after June 15, BTC fell from $66,000 to $58,000.Murphy pointed out that low IV is linked to market consensus, the accumulation of volatility arbitrage capital, and market makers’ short-gamma strategies, which may amplify the impact of unexpected events, and he urged futures traders to be prepared.
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