After months of muted price action, Bitcoin’s implied volatility is beginning to climb, signaling that a significant market move may be approaching.
On Monday, Bitcoin’s 30-day implied volatility (IV) jumped from 33 to 37, according to the Deribit Volatility Index (DVOL) — its highest level in several weeks. This follows a sharp rebound from last week’s low of 26%, one of the lowest volatility readings ever recorded in crypto options markets.
Implied volatility, derived from options prices, reflects the market’s expectations for future price swings. Rising IV often precedes larger moves, as traders anticipate increased uncertainty or momentum in either direction.
Bitcoin’s price action has already begun to reflect this shift. Over the weekend, BTC surged from $116,000 to $122,000, edging closer to its all-time high near $123,000. This rally was spot-driven, according to Checkonchain, suggesting a more stable market foundation than leverage-fueled breakouts.
Although August is typically a low-volume month, the sudden rise in volatility may indicate that traders are preparing for broader market shifts. Notably, open interest in Bitcoin derivatives has declined in recent weeks — a setup that could amplify volatility if leveraged capital reenters the market.
As the volatility index rises and price momentum builds, market participants are watching closely for a decisive move. If history is any guide, a breakout — or breakdown — may not be far off.
