Bitcoin Market Still Controlled by Traders
Jeff Park, Senior Advisor at Bitwise, recently pointed out on social media that the current Bitcoin market remains trader-driven. He emphasized that without significant volatility, it’s difficult for Bitcoin to sustain an upward trend.
The current implied volatility of Bitcoin is around 38, and the monthly trading volume has been sluggish, especially concerning January data. Against the backdrop of a generally strong precious metals market, Bitcoin’s performance stands out as particularly underwhelming.
Volatility Drives Price Growth
- Jeff noted that markets often mistakenly believe derivatives suppress Bitcoin’s price — the opposite is true.
- Using the silver market as an example, he explained how paper silver operations once drove explosive price gains.
- Leverage tools, margin mechanisms, and liquidity mismatches accelerate market volatility.
He stressed that supporting Bitcoin inherently means accepting its volatility. Any perspective that ignores this reality fails to grasp the fundamental nature of digital asset markets. While short-term volatility may not be immediate, in the long run, Bitcoin will ultimately reshape market perceptions.