- BVIV breaks above year-long resistance line after declining from annualized 73%.
- Post-October crash liquidity thinning on major exchanges amplified market swings.
- Analysts cite reduced volatility selling by whales and rising U.S. macro risks.
Nov. 12 (Crypto-News.Net) – Bitcoin’s (BTC) 30-day implied volatility index broke above a year-long downtrend resistance, ending a period of declining volatility that began in late 2024.
The BVIV index, which tracks expected Bitcoin price swings based on options pricing, broke through a declining trend line that had pushed volatility lower from an annualized rate of approximately 73%, according to market analysis published Tuesday. The breakout suggests increased demand for protective options contracts and potential for sharper price movements in coming weeks.
“We’re seeing reduced volatility selling from whales and miners who had been consistently suppressing premiums throughout the year,” Jimmy Yang, co-founder of Orbit Markets, said in the analysis. The shift indicates major holders have scaled back strategies that dampened Bitcoin price fluctuations during 2025’s relative stability.
Liquidity Thinning After October Crash
Exchange order books thinned following the Oct. 10 market selloff, when Bitcoin fell sharply amid liquidations. Market makers reduced activity as traders hesitated to build leverage positions, according to crypto market data. Jeff Anderson, head of Asia at STS Digital, said the liquidity reduction on platforms including Binance and CME amplified price swings.
Binance handled 30% to 40% of global spot and futures volume during the October crash, with thinner order books magnifying volatility, according to VanEck’s October market recap. The reduced liquidity followed Federal Reserve policy decisions that had already created uncertainty in crypto markets.
Macro Uncertainty Adds Pressure
Rising macroeconomic risks, including concerns about a U.S. government shutdown and debates over Federal Reserve policy, contributed to the volatility breakout. Griffin Ardern, head of research and options at BloFin, cited uncertainty around December rate decisions as a factor driving institutional investors to increase hedging positions.
The analysis noted elevated demand for out-of-the-money put options below $100,000, indicating institutions sought downside protection. Higher implied volatility translates to increased costs for hedging strategies and options premiums.
The BVIV breakout contrasts with 2025’s pattern of record-low volatility, which had characterized Bitcoin trading for most of the year before the October disruption.
