Bitcoin (BTC) has often been criticized for its wild price swings, with previous bull runs marked by sudden and steep pullbacks that, by traditional market standards, would be classified as bear markets.
However, the current bull cycle that began in early 2023 is showing a notably different pattern — one defined by lower volatility and milder drawdowns.
Volatility Trends Point to Stability
Glassnode’s data reveals that Bitcoin’s realized volatility, measured on a rolling three-month basis, has averaged under 50% throughout this bull market. This is a substantial decline from the 80% to 100% volatility levels seen during earlier rallies.
Similarly, the 30-day implied volatility, tracked by Volmex’s BVIV index via TradingView, has been trending downward. Unlike realized volatility, implied volatility reflects the market’s expectation of future price fluctuations, making this drop a positive indicator for stability ahead.
The growing market capitalization of Bitcoin appears to be a key factor in this reduced volatility. At over $2 trillion, Bitcoin ranks as the seventh-largest asset globally. With such scale, moving the market requires increasingly larger amounts of capital, which tempers price swings.
Glassnode explains: “As liquidity deepens and valuations reach these levels, the capital needed to meaningfully impact Bitcoin’s price grows significantly.”
Institutional involvement, spurred by the introduction of U.S. spot Bitcoin ETFs and clearer regulatory frameworks, has also brought in sophisticated investors, further stabilizing the market.
A More Measured Rally
Looking back at the 2020-21 bull market, Bitcoin’s rise from $4,000 to nearly $70,000 was punctuated by sharp corrections exceeding 30%. In contrast, the current rally from approximately $30,000 in March 2023 to above $100,000 resembles a stair-step progression — impulsive price jumps followed by extended periods of accumulation before the next surge.
Glassnode notes, “This cycle’s drawdowns are generally shallower, mostly less than 25% from local highs, with only two instances surpassing 30%.”
This gentler price behavior is tied to reduced speculative excess and institutional-grade market dynamics. Previously, exchanges like Binance offered up to 100x leverage, allowing traders to magnify gains but also risking cascading liquidations and sharp downturns.
Today, with stricter leverage limits and more cautious market participants, the Bitcoin rally shows signs of greater durability.
