Bitcoin’s volatility is going crazy as the price dropped down 20% to $43k today, right after a week of shockingly low activity!
Bitcoin 7-Day Volatility Declined To 2.3% Last Week
As per the latest weekly report from Arcane Research, the 7-day volatility of the cryptocurrency declined again this past week.
The volatility is an indicator that shows how wildly the price of an asset (in this case, Bitcoin) is changing. The 7-day version of the metric calculates the percentage compared to the price at the start of the week’s period.
When the value of the 7-day volatility goes up, it means price action is going up as BTC sees big swings in its value.
Now, here is how the current state of the Bitcoin volatility looks like:
BTC's volatility declines in the past week | Source: Arcane Research Weekly Update - Week 35
The above graph shows that the 7-day volatility of the coin once again dipped down as the indicator’s value hit 2.3% in the last week.
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The volatility hasn’t declined to such low values since July, when the metric assumed the lowest value for the year.
Back then, the 7-day volatility percentage was about 1.6%, a value that wasn’t too far from this one. So if the indicator declined further, it’s possible it could revisit those lows.
However…
Good News! El Salvador Adopting BTC Seems To Be Ushering In A New Wave Of Activity
El Salvador officially recognizes Bitcoin as legal tender today, making it a historic day for the cryptocurrency. Yesterday the South American nation bought 200 BTC for the occasion as it plans to give every citizen $30 in the crypto. The country also announced more purchases will follow soon.
As it’s a huge event, many expected BTC to gain some fresh volatility. But nobody could have expected the price to fluctuate this wildly!
A wild day for Bitcoin | Source: BTCUSD on TradingView
BTC’s volatility has gone absolutely crazy as the price crashed 20% down to $43k just half an hour ago! And it was almost $53k just 12 hours earlier! And now it’s back just above $47k already!
Related Reading | Tensions Grow In El Salvador Over The Bitcoin Gamble
All this price activity right after such a bad week for the volatility is incredible to see, to say the least. It’s quite hard to say what will happen next in such an environment, but it’s quite possible $43k was the bottom, and the price might continue to move up.
About El Salvador accepting Bitcoin as legal tender, what are your thoughts on it? Share them with us here!
With #Bitcoin becoming legal tender in #ElSalvador, how long until it becomes the global reserve currency? @nayibbukele
— Bitcoinist.com (@bitcoinist) September 7, 2021
Featured image from Pexels, charts from Arcane Research, TradingView.com