Bitcoin Volatility Drops to All-Time Low Compared to Gold

Bitcoin volatility has dropped to a new all-time low compared to Gold. VanEck's head of digital assets research, Matthew Sigel, shared the data from Bloomberg Terminal

Bitcoin's 30-day volatility dropped to a new all-time low compared to Gold, shared on X (formerly Twitter) by VanEck’s head of digital assets research, Matthew Sigel.

According to data from Bloomberg Terminal, which Sigel shared on X, BTC 30-day volatility fell to 28.70. This is the lowest volatility level for Bitcoin in more than 10 years and also meant that BTC volatility dropped below Gold's for the first time. The same data shows that Gold currently has a volatility of 33.49 while the SPX also has 40.45 within the same period.

With Bitcoin volatility dropping, the volatility ratio for Bitcoin and Gold now stands at 0.87. It is the lowest level in a decade. Sigel considered this to be a good development for the flagship asset.

Volatility describes the degree of price variations for an asset over a period of time. When low, it is generally considered a positive sign of asset maturity and price stability, which will attract more institutional investors. This appears to be Sigel’s point of view.

The VanEck researcher had earlier highlighted a recent research paper stating that CERN Physicists have been able to turn lead into Gold. He used this as further proof of the inherent value of Bitcoin as the scarcity is already programmed, unlike Gold, which may soon be produced in laboratories.

Low volatility may be bad for Bitcoin

However, not everyone agrees that low volatility is good for BTC at the current stage. As one user observed, Bitcoin is still in its early stages, and volatility expansion could attract more inflow, which could be bad for low volatility.

They wrote:

“Persistent low volatility regime would likely lead to many investors selling BTC (and our many complicated BTC proxies) to integrate for yield and opportunity elsewhere.”

While the likelihood of low volatility persisting is unknown, the concerns echoed real. The decline in Bitcoin volatility is because the asset has been stuck in price ranges for extended periods over the past month despite gaining more than 22% in the last 30 days.

Initially, it was in the $93,000 to $96,000 range for most part of late April and early May. However, it surged above $100,000 on May 8 and has remained stuck in that price zone, not exceeding $104,000 even as other assets saw bigger shifts.

Bitcoin’s low volatility has allowed it to maintain its current $103,000 value even as altcoins saw a decline in their value over the last 24 hours. Still, its failure to break the $104,000 resistance remains a concern.

However, experts have found an explanation for why Bitcoin is stuck. Onchain analyst Darkfost said that the derivatives market is to blame, pointing out that short positions against BTC have exceeded long positions since the asset climbed above $100,000.

This suggests that most traders doubt that Bitcoin can hit a new all-time value quickly and are betting against it, leading to significant selling pressure.

Bitcoin is still in the acceleration phase

However, the low volatility and price stalling do not bother most market experts who believe Bitcoin is on track to set a new all-time high. Fidelity VP of Digital Assets Research, Chris Kuiper, recently shared a report showing that Bitcoin is still in Acceleration Phase.

According to the report, the Acceleration Phase is a period of high volatility and high profits, with investors pushing the assets to a peak price before they retreat to the Reversal Phase. As of May 13, when BTC was trading at $104,119, 99% of wallets were in profits.

Beyond that, Binance whale inflows to exchanges have dropped to the lowest level since November 2024, according to CryptoQuant. This is another positive indicator of future price expansion.

Meanwhile, crypto analyst Ali Martinez believes that the Bitcoin market’s top for this cycle could be at $120,000 as long as the $90,000 support level is maintained.