Bitcoin Volatility Drops to Lowest Since 2016, Easing Risk of Mass Liquidations

Bitcoin's price volatility has fallen to its lowest level since 2016.

BlockBeats reported on July 22 that Axel Adler Jr., a CryptoQuant contributor, wrote that Bitcoin's 30-day moving average of realized volatility recently fell to 28.3. That was down nearly 13% from 41.6 on June 25, about a month earlier.

The latest reading places Bitcoin in roughly the bottom 8% of its volatility distribution since 2016, Adler wrote. In other words, about 92% of past trading days posted higher volatility than the current level.

Bitcoin has rebounded and steadied in the $65,000 range recently, but open interest has not increased sharply, he added. That indicates leverage has eased, lowering the risk of large-scale liquidations.

Still, it is too early to turn bullish because Bitcoin remains below its 200-day moving average in the mid-$72,000 range. Adler wrote that if realized volatility rises above 35 and Bitcoin still fails to reclaim the 200-day moving average, downside pressure could build again.