Volatility spiked again towards the end of that year following the last washout on Dec. 15, when BTC fell to $3,200.
On-chain analysis indicates that Bitcoin market volatility is at its lowest period. Crypto analysts have been monitoring BTC’s historical volatility levels and have bottomed out.
The last time volatility plummeted to levels close to current ones was in late 2018. This was a bear market similar to current conditions, with cryptocurrency prices plummeting during that year.
Will Clemente, Co-Founder of @ReflexivityRes, tweeted that “Bitcoin’s volatility is at an all-time low.”
Other analysts also confirmed the new Bitcoin volatility low. The asset has traded between $15,700 and just over $18,000 over the past six weeks. With most of the world in a holiday period, market activity is unlikely to pick up until next month.
It was noted that a rally has previously followed periods of such low volatility. “Every time volatility fell below the ‘1’ value, it was followed by a bullish rally with one exception: October 2018,” one analyst said.
Coiner-Yadox, Bybit Affiliate , tweeted that “Bitcoin volatility is lower than 2018 just before the 6k break.”
Bitcoin Hash Rate Plummets
Volatility is not the only metric that has taken a dive for Bitcoin. The hash rate of the network is also dropping considerably; however, the two are not necessarily connected.
According to Blockchain.com, hash rates dropped to 229 TH/s (terahashes per second) on December 25. This represents a 16% decline from the all-time high in early November.
The recent drop was blamed on Texas miners shutting down due to severe weather conditions and demand on power grids. There have been concerns about another liquidation of distressed miners, but it has yet to materialize.
Dennnis Porter, CEO & Co-Founder of @SatoshiActFund, tweeted that “Over 30% of the #Bitcoin hashrate has gone offline due to extreme weather in Texas, and yet the global #Bitcoin network continues to work perfectly. Now imagine if Amazon or Google tried turning off 1/3rd of their data centers.”
BTC Price Outlook
Bitcoin prices have done very little over the weekend, hovering around $16,800 for the Christmas holidays.
However, BTC rose to a five-day high of $16,895 during the Asian trading session on Monday morning. There hasn’t been any real momentum since the asset fell below $17K on Dec 16, it has flattened ever since.
The crypto market capitalization is currently at $846 billion, which is pretty close to the highs after the 2017 bull market. With a 72.5% drop, most analysts agree that the markets are close. bottoming out for this bearish cycle.
By Audy Castaneda
