Bitcoin (BTC) Short-Term Volatility Drops to Multi-Year Lows, Sparking Speculation About Potential Upcoming Market Movements

The short-term volatility of Bitcoin has recently dropped to levels not seen in years, sparking speculation about potential upcoming market movements.

Bitcoin's short-term volatility has hit new lows, reaching levels not seen in years. According to data from Glassnode, the Bitcoin 1-week realized volatility has dropped to 23.42%, approaching historical lows. Over the past four years, the metric has dropped below this level only a few times.

Notably, this occurred in October 2024, when it slumped to 22.88%, and in November 2023, it bottomed at 21.35%. Interestingly, historically, such periods of compressed volatility have been followed by significant uptrends.

For context, in November 2023, when Bitcoin's 1-week realized volatility touched a low of 21.35%, the premier asset was trading at $27K. By the end of January 2024, its price had appreciated by nearly 100%, reclaiming the $50K mark.

Similarly, in October 2024, Bitcoin was around $63K but has since improved by a similar magnitude, peaking at $110K in January 2025.

Now, with Bitcoin's short-term volatility revisiting its historical bottom, analysts wonder if another major move is on the horizon. This comes at a time when Bitcoin's performance has been relatively stagnant around the upper $90K region.

However, as of today, Bitcoin is making another bold attempt at the $100K level, reaching an intraday high of $99,500 at press time.

On the other hand, the 1-week implied volatility (IV) for Bitcoin options has similarly dropped to 37.39%, according to Glassnode data. This current figure suggests that traders are not anticipating major short-term price swings.

It marks a significant dip from earlier levels. The last time IV was this low was in 2023 and early 2024. Also, notable volatility spikes followed.

Despite the short-term calm, longer-term implied volatility remains elevated. Specifically, Bitcoin’s 3-month IV stands at 53.1%, and the 6-month IV is at 56.25%.

These higher levels suggest that, while the market remains uneventful in the short term, traders are still bracing for larger swings in the medium and long term.