The current situation of the world’s largest cryptocurrency, Bitcoin, is quite challenging, with its price movement following the approval of a spot Bitcoin ETF. However, in January 2024, Bitcoin’s 12-month annualized volatility hit its lowest levels in 12 years, as reported by Charlie Bilello, chief market strategist at the wealth management firm Creative Planning.
Bitcoin’s last 12-month volatility
Over the years, the performance of Bitcoin has experienced ups and downs. In January 2012, Bitcoin’s 12-month annualized volatility was an impressive 179%, but by January 2024, it had decreased to 45%, following a general downward trend.
Bitcoin and other cryptocurrencies are known for their unpredictable nature, attracting investors seeking to take advantage of price changes for potential profits. However, this unpredictability also deters those who prefer safer, less risky investments due to the frequent and significant fluctuations in the market.
Bitcoin’s 12-month annualized volatility is a measure that illustrates how much its price fluctuates in a year. A higher percentage indicates more significant price changes, reflecting a more unpredictable market. Conversely, a lower percentage suggests a more stable market. According to Bradley Park, a web3 analyst at CryptoQuant, lower volatility might indicate that more people are holding onto Bitcoin for the long term.
Also Read: Hong Kong gets first spot Bitcoin ETF appeal, what’s next?
Stability in the crypto market?
Following this volatility data, Bitcoin is currently trading near the $42,000 level, and in the last 24 hours, it experienced a slight 0.85% downside momentum. Over a more extended period, in the last 7 days, it experienced over 35% upside momentum, while in the last 30 days, it saw over 2% downside momentum.
Analyzing Bitcoin’s price momentum over the last 30 days, it appears stable, possibly due to a more stable market. Additionally, according to Glassnode, an on-chain analytics firm, it has been observed that in the past few days, despite price consolidation, the number of new Bitcoin addresses is continuously surging.
Apart from Bitcoin, the world’s second-largest cryptocurrency, Ethereum has also exhibited stability in its price. Currently, ETH is trading near $2,250, and in the last 24 hours, it has experienced a 1% downside momentum. If we look at ETH over a longer period, in the last 30 days, it has seen a minor 5% downside momentum.
