The volatility of Bitcoin is reaching its lowest levels so, naturally, the same is happening for Bitcoin futures contracts. At the moment, futures have reached their lowest level ever, which shows the stability of the crypto market now that is more stable than the current traditional asset marketplace is with the trade war between China and the United States.
According to Kevin Davitt from CBOE Global Markets, XBT (Bitcoin) futures are moving at a very little speed and this week they had the least volatility since they were launched. The average weekly volatility in October was only 6.6%, down from the 28.23% of when the futures were launched back in December 2017.
In fact, there is a clear trend that shows that the volatility has been down. While at first, it was considerably higher, now it is slowly getting flattered. The trend is very similar to the main Bitcoin market that did not leave the 6,000 range mark for a long time now.
Some people believe that this shows some fatigue from the retail investors while other people seem to believe that the effect is caused by the lack of speculation in the market, which is slowly getting more and more stability.
Some people, like Mati Greenspan, an analyst from eToro, defends the idea that the flat price of Bitcoin is a testament that the market has increased its liquidity and maturity, which would prove that price discovery “works for all assets”.
In the market at large, the movement is very mixed. Some cryptos are going up like Ripple’s XRP, while Ethereum is flat like Bitcoin and some tokens are losing value.
Cryptos More Stable Than Equities
It is an interesting move that cryptos seem to be reaching a whole new level of stability right when the equity market is so wild as the volatility is increasing in the global markets.
The main difference is that the traditional market is more shaken by the news of the trade wars that the U.S. president Donald Trump is promoting now while after the severe bear market, cryptos seems to finally be getting some stability. The uncertain rise of interest rates also affects the traditional markets.
Obviously, the trade war will not last forever and neither does the post-bubble crash bear market of cryptos, so there is plenty of space for things changing with time.