Volatility is heating up across Bitcoin (BTC) and Ethereum (ETH) as markets deal with fears of a renewed U.S.-China trade war as well as a potentially bursting AI bubble. Derive.xyz noted that the 30-day implied volatility for BTC has surged to 45%, up considerably from around 30% a month ago, meanwhile, ETH has jumped from approximately 57% to 72% during the same period.
At the time of writing, Bitcoin price has fallen from just over $111,000 at the start of this current week to below $108,000 at the time of writing. Other cryptocurrencies like Ethereum, Solana, BNB, and Altcoins are experiencing declines as well due to growing uncertainty.
Derive.xyz further noted that longer-dated contracts are exhibiting somewhat similar stress. BTC’s 90 and 180-day vols have increased from 36% and 40% to 47%, while ETH’s have surged from 60% and 63% to 71% and 68% respectively.
According to the update from Derive.xyz, this latest shift indicates that traders are increasingly bracing for potentially sustained turbulence ahead. The major price swings seen earlier this month, along with growing macro uncertainty, have shaken investor confidence across Bitcoin and broader crypto-asset markets.
Adding to the concerns, BTC 90/180-day skew has reportedly reached its lowest level in 12 months, indicating more elevated demand for downside protection.
And despite BTC’s steady price performance, traders are now said to be clearly hedging against the risk of further drawdowns.
Still, not all is bleak, the Derive.xyz update noted while adding that Fedwatch now places the chances of a 25 basis point rate cut on October 29 at 99%.
The report also mentioned that lower rates may drive renewed inflows into risk assets like crypto as investors “hunt for yield – a potential tailwind that could offset the current volatility spike.”
As covered, Derive.xyz (TVL $115.8M, $18.6B trade volume). is the decentralized protocol that creates “programmable onchain options, perpetuals, and structured products.”
It empowers users with accessible automated strategies “to build, grow, and preserve wealth.”