Bitcoin (BTC) Volatility Declines: ‘Dull’ Price Action Explained

Bitcoin has become significantly less volatile in recent times. This is evidenced by the absence of extreme peaks in price movements in either direction since the end of the fourth half.

According to experts, this trend of decreasing volatility indicates maturity.

Bitcoin is seeing signs of maturity

Over the past week, bitcoin saw a modest decline of just over 3%, with selling activity outpacing buying on nearly every exchange. According to Kaiko’s latest findings, the cumulative net trading volume of major BTC trading pairs reached $518 million between June 10-14, with Binance and Bybit witnessing the highest level of selling pressure .

Kaiko stated that while bitcoin experienced price swings as a result of macroeconomic news last week, the digital asset appears to have reached a new level of maturity in 2024, which can be seen in its volatility decreasing

Bitcoin’s historical 60-day volatility has remained below 50% since early 2024. This was in stark contrast to the massive swings seen in 2023 when volatility exceeded 100%.

In 2024, BTC reached an all-time high in terms of volatility, but Kaiko said that this peak was only 40%, which is much lower than the over 106% volatility peak seen in 2021 when the active recorded high prices.

Even the launch of spot Bitcoin ETFs in the US had a relatively muted long-term impact on volatility according to the firm’s analysis.

“While it is too early to suggest that this is the new normal, changes in the structure of the bitcoin market over the past year may help explain why price action has been relatively “dull.” The US market close now has a higher proportion of trading volumes as BTC liquidity is more concentrated around the East Coast trading window.”

Stronger selling pressure

The increased selling pressure that demand to buy bitcoin trapped its price below $70,000.

In a statement to CryptoPotato, Fineqia International research analyst Matteo Greco highlighted that the price drop over the weekend was influenced by the high selling volumes of miners affected by the third halving event that reduced block rewards from 6.25 BTC to 3.125 BTC.

Although only a 4% hash rate has decreased after the halving, strong mining competition has forced miners to optimize capital efficiency. This essentially indicated “intense competition in the mining sector, with companies forced to find multiple sources of revenue to remain profitable and optimize capital efficiency.”

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