Bitcoin (BTC) could experience a sharp price swing as volatility remains near monthly lows and could soon rebound, according to a report by blockchain options platform Derive.
Derive Warns: Bitcoin Volatility Poised for a Comeback
BTC has been consolidating between $80,000 and $85,000 since March 12, following a sharp decline from its all-time high of $100,000.
The decline was attributed to President Donald Trump's new tariffs and the lack of further purchases for the U.S. Strategic Bitcoin Reserve.
Despite the current period of low volatility, Derive founder Nick Forster suggests that this could be a temporary lull before a significant price move.
“BTC’s weekly at-the-money (ATM) volatility fell to 49%, nearing a monthly low of 45%. Meanwhile, realized volatility fell from 91% to 54%.”
What Could Trigger the Next Move?
Forster emphasized that volatility does not predict price direction, meaning BTC could see major swings up or down. Factors that could lead to a resurgence of this volatility include:
- Geopolitical uncertainties such as developments in Ukraine
- Regulatory changes under the Trump administration
- The Federal Reserve's policy decision to be announced on Wednesday
With the Fed expected to keep interest rates on hold, traders are currently pricing in two to three rate cuts this year. A more dovish stance than expected could provide fuel for Bitcoin bulls, while continued equity market declines could push prices lower.
Derive's Market Impact
Derive, an AI-powered on-chain options platform, has seen significant activity with approximately $100 million in total value locked (TVL) and $15 billion in cumulative trading volume.
Given the deep market insights, traders are closely watching whether the projected volatility resurgence will propel BTC to new highs or trigger another sell-off.
*This is not investment advice.
