Matrixport Investment Research: BTC volatility is close to a multi-year low, options may be the ideal investment method at present

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Matrixport
half a month ago
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BTCs realized volatility is approaching a multi-year low, and investors are advised to invest rationally.

The latest research from Matrixport Research Institute shows that the recent focus is on:

  • BTC’s realized volatility is approaching multi-year lows, and options investing may be a good idea at the time.

  • The SEC is more likely to approve the S-1 application, and ETH spot holdings surge

  • BTC options trading shows bullish sentiment, and expectations for market growth in 2025 are rising

As the market enters a summer consolidation phase, the decline in volatility allows investors to purchase options at a lower cost without taking on excessive market risk. The demand signals for fiat-to-cryptocurrency conversions have weakened, indicating that a period of calm may be coming, and the fear of missing out (FOMO) sentiment is relatively low. Therefore, investors should adopt a rational positioning strategy.

BTC’s realized volatility is approaching multi-year lows, and options investing may be a good idea at the time.

Bitcoin’s realized volatility is approaching multi-year lows. A year ago, when volatility fell to similar levels, Matrix on Target suggested that investors could use options to express their views while keeping the majority of their crypto assets in Treasury-backed stablecoins with stable returns.

The SEC is more likely to approve the S-1 application, and ETH spot holdings surge

As of May 23, the SEC has officially approved 19 b-4 applications submitted by eight asset management companies. These companies applied to list and trade Ethereum ETFs on US exchanges, but have not yet completed S-1 registration statements. As a result, Ethereum futures holdings surged from $7.5 billion to $13 billion, and the funding rate increased to 27% annualized.

While the best market periods are often just before a product is launched (or listed) and is about to receive SEC approval, sell-offs are often seen after the product is listed, such as the Bitcoin futures listing in December 2017, the Coinbase IPO in April 2021, the futures-based Bitcoin ETF in October 2021, and the Bitcoin spot ETF in January 2024.

However, the market believes that the SEC will approve the S-1 application soon and the ETH ETF will be listed between July and September this year. Once the summer consolidation period ends, the market will usher in another wave of bullishness. Prudent investors can take advantage of the low volatility environment to protect their portfolios through options, or buy call options to obtain strategic gains while taking advantage of the exposure of mainstream cryptocurrencies to obtain risk-free returns.

Bitcoin options trading shows bullish sentiment, diverging from BTC price trend

BTC fell more than 1% in the past 24 hours to $64,500 (data as of 2 PM on the 21st). However, QCP Capital said that the large-scale purchase of options with December and March expiration and strike prices of $90,000 to $100,000 in the past 24 hours indicates that the market is bottoming out and preparing for a rebound that may last until 2025. The bullish sentiment in the options market deviates from the price trend of Bitcoin, especially in the long-term market, showing investors expectations of future price increases.

Some of the above views come from Matrix on Target. Contact us to obtain the full report of Matrix on Target.

Disclaimer: The market is risky and investment should be cautious. This article does not constitute investment advice. Digital asset trading can be extremely risky and unstable. Investment decisions should be made after carefully considering personal circumstances and consulting financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.

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