Bitcoin: Traders bet on sideways momentum for BTC as…

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Bitcoin’s implied volatility begins to decline. The options market expects sideways momentum for BTC going forward. Both the price and the speed have declined, indicating low transaction activity around BTC.

The Bitcoin price has seen high volatility over the past few months, but over the past few days, it appeared that BTC is likely to move sideways in the near future.

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Some stability for BTC in the future?

This was indicated by the decline in implied volatility for Bitcoin. According to data from glassnodes, it has started to reach new lows. This shows the options markets expectation of Bitcoin to maintain price stability.

Source: glassnode

In terms of trader behavior, at press time, around 27,000 Bitcoin options were approaching their expiration date, possessing a Put to Call ratio of 0.64. A Put to Call ratio of 0.64 indicates a higher proportion of open call options, suggesting that market sentiment is tilting towards price increase expectations.

Additionally, these options carry a maximum pain point value of $26,500. The maximum pain threshold at $26,500 signifies the price level at which option holders can suffer the greatest financial losses. The expiring options collectively have a notional value of $720 million, representing substantial market participation.

Will FUD spread?

However, the spreads on Binance, which are currently around 20x wider than those on Coinbase and Kraken, could impact BTC in the long run.

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Spreads on https://t.co/pup2WYms9R are currently about 20x wider than those on Coinbase and Kraken pic.twitter.com/qVt06FGnx7

Kaiko (@KaikoData) June 9, 2023

Wide spreads indicate a greater difference between the buy and sell prices of BTC on Binance compared to Coinbase and Kraken. This suggests lower liquidity on Binance, which makes it harder for traders to enter and exit positions efficiently. Reduced liquidity can lead to increased price volatility and potentially impact the stability of BTC.

Additionally, wider spreads generally result in higher trading costs for market participants. Traders who need to buy or sell BTC may incur greater expenses due to the greater price difference between bid and ask prices.

Read bitcoin price prediction 2023-2024

At the time of writing, BTC was trading at $25,754.89 according to CoinMarketCap. Over the past week, the price of BTC has dropped significantly. Along with this, the speed of BTC dropped, indicating a drop in activity. Additionally, interest in NFT Bitcoins has also declined, as indicated by the drop in NFT transactions on the network.

Source: Santiment

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