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Analysis of the Current Volatility of Financial Markets and the Implications for Bitcoin

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It is reported that the CBOE Volatility Index (VIX, commonly known as the fear index of Wall Street) of the Chicago Board of Options Exchange has jumped from 1…

Analysis of the Current Volatility of Financial Markets and the Implications for Bitcoin

It is reported that the CBOE Volatility Index (VIX, commonly known as the fear index of Wall Street) of the Chicago Board of Options Exchange has jumped from 18 to 23 in the past three days, reaching the highest point in 2023. In contrast, the Bitcoin Volatility Index (BVIN), which measures the implied or expected volatility in the next 30 days, has recently stabilized, approaching the lower limit of the three-month range of 60 to 100. The implied volatility usually represents the degree of market uncertainty or anxiety. At the same time, the MOVE index, which measures the volatility of US treasury bond bonds, has jumped to a one month high of 120, ending the four month downward trend. The price of Bitcoin only evolved into a macro asset after a sharp decline in March 2020. After that, BVIN usually closely tracks the trend of VIX. The analysis shows that the conditions for Bitcoin to make a breakthrough in 2023 are mature. （coindesk）

CBOE Volatility Index of the Chicago Board of Options reached its highest point in 2023

Interpret the above information:


The recent volatility of the financial markets has drawn attention to the behavior of the CBOE Volatility Index (VIX) and the Bitcoin Volatility Index (BVIN). This message reports that the VIX has risen from 18 to 23 in the past three days, representing the highest point in 2023. In contrast, the BVIN has stabilized, approaching the lower limit of its three-month range of 60 to 100. The MOVE index, which measures the volatility of US treasury bonds, has also jumped to a one-month high of 120, ending a four-month downward trend. The market often perceives implied volatility as an indicator of market uncertainty or anxiety.

The behavior of the VIX, BVIN, and MOVE index all point to heightened volatility in the financial markets. However, the relatively stable BVIN in the face of increased uncertainty suggests that Bitcoin may behave differently from traditional macro-assets in terms of its volatility.

After a significant decline in March 2020, Bitcoin has recently become a macro-asset that is increasingly linked to the VIX. However, recent analysis shows that the conditions are ripe for Bitcoin to make a breakthrough in 2023. In light of this development, investors may see Bitcoin as a more reliable and stable investment option during times of market uncertainty.

In conclusion, the behavior of the VIX, BVIN, and MOVE index highlights the current volatility of the financial markets. The stability of BVIN under these conditions suggests that Bitcoin may perform differently from other macro-assets. Analysis shows that the conditions are ripe for Bitcoin to make a breakthrough in 2023, which could increase the attractiveness of Bitcoin as an investment option.

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