Lower BTC volatility does not necessarily mean lower risk

Bitcoin’s 30-day implied volatility has fallen to 36%, a long-standing low, but lower volatility does not necessarily mean lower risk, CoinDesk reported. Lower volatility reduces trading costs, encouraging investors to build large directional bets and hedge positions, which also leaves market makers exposed to significant risk. Once the market starts moving, both sides tend to manage more positions, adding to price swings. Paul Howard, a Wincent official, said weakening put option demand and a lack of strong buying for upside risk suggest Bitcoin is nearing the lowest price range of this bear market and could bottom within weeks.