The 30-day real volatility of $BTC (-0.46%) has fallen from over 100% during the FTX collapse at the end of 2022 to a sustained level below 50%, which has persisted since then - with only minor interruptions. We see this as a structural change. When #bitcoin reached its all-time high in 2021, the 30-day volatility was over 106%. At the new all-time high in March 2024, the same figure was around 40%. An asset that repeatedly discovers prices with less and less volatility is maturing by any strict definition.
The mechanism is simple: institutional capital flowing into the market, mainly via ETFs, ensures smoother price movements in both directions compared to previous cycles characterized by speculative exuberance by private investors. Long-term investors absorb supply shocks that used to lead to cascades.
$BTC (-0.46%) However, equities remain around three times more volatile than equities and would still take years to reach the volatility profile of more established asset classes based on current trends. However, the direction is clear, and the direction is ultimately decisive for any investment thesis.
