The long-term volatility of Bitcoin (BTC) and Ethereum (ETH) has reached its lowest level in more than two years, according to a recent report by Kaiko Research. The research firm highlighted that while ETH has historically been more volatile than BTC, the gap between their volatilities has significantly narrowed.
Currently, BTC’s 180-day volatility stands at 46%, while ETH’s hovers around 50%. However, despite this decline, crypto volatility remains almost double that of traditional risk assets such as tech equities. BTC experienced a tumultuous week, closing lower on Sunday following a mixed U.S. jobs report.
In other industry news, Binance, one of the largest cryptocurrency exchanges, appointed a potential successor to CZ as regional director. Celsius, a prominent cryptocurrency lending platform, has deposited a staggering $745 million worth of ETH into staking contracts since June 1. Additionally, Coinbase’s derivatives exchange is set to introduce new BTC and ETH futures later this week.
The report then delves into the future of privacy tokens, highlighting Binance’s recent announcement to restrict the trading of privacy tokens for users in several countries starting June 26. This follows similar de-listings by other major exchanges, indicating increasing regulatory scrutiny.
While privacy tokens enable anonymous transactions, countries like South Korea, Japan, and Australia have already banned them, and new recommendations from the Financial Action Task Force are likely to heighten regulatory pressure.
Bitcoin’s Liquidity Remains Steady Despite Token Unlock
The report also discusses the recent market trends of various cryptocurrencies. It notes that top privacy tokens have generally underperformed in the broader market due to regulatory scrutiny.
However, the Mask ecosystem’s native token, MASK, experienced significant traction after Elon Musk’s acquisition of Twitter. Despite a drop in trade volume and prices, the liquidity of privacy tokens has improved over the past year, with Binance leading the way.
The report further covers various topics, including Bitcoin’s discounted trading against the Australian dollar, liquidity of the Layer 2 network Optimism’s OP tokens, Tether’s market cap hitting an all-time high despite low volumes, and declining volumes for early DeFi tokens.
It concludes by highlighting XRP’s increasing open interest ahead of the long-awaited court decision between Ripple and the U.S. SEC and Bitcoin’s risk-adjusted returns falling behind the Nasdaq’s in recent months.
However, the cryptocurrency market is witnessing a period of reduced volatility and changing dynamics, with traditional assets outperforming BTC in risk-adjusted terms. These developments have implications for investors and traders, as well as regulatory authorities closely monitoring the crypto space.
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