With Bitcoin rallying from $30,000 to $42,000 and back again during January, BTC’s annualized volatility rose to levels last seen in April 2020, according to a new report from U.S. crypto exchange Kraken.
January was a roller-coaster ride for Bitcoin, with BTC rallying 46% to a new high of $41,989 before retracing 32% to below $29,000. This resulted in the annualized volatility spiking to over 100% — which was last seen 10 months ago during the infamous ‘Black Thursday’ price plummet.
In early-March 2020, Bitcoin’s price dove more than 40% in a matter of days from $9,000 to $5,200 — resulting in volatility spiking from 60% to more than 150%.
Despite its surging volatility, Bitcoin registered the smallest volatility spike of the top five crypto assets by market cap (excluding Tether).
Polkadot (DOT) finished the month with the largest volatility of 228%, followed by Cardano (ADA) with 183%, and Ethereum (ETH) with 160%. Unlike Bitcoin, ETH, DOT, and ADA evaded heavy corrections during January, closing out the month near their respective local highs.
Looking forward, Kraken anticipates that Bitcoin’s price will trend upwards with reduced volatility during February:
“Given that Feb., on average, returns six percentage points more than Kan. and is 15 percentage points less volatile, one might expect Feb. to outperform Jan. and volatility to dwindle as BTC melts up.”
However, not everyone is convinced Bitcoin will continue its road to higher peaks. Famed gold-bug and notorious Bitcoin-skeptic, Peter Schiff, speculated BTC’s bullish momentum is unlikely to last, predicting it will be superseded by the surging meme-coin DOGE:
Being the first mover gave Bitcoin a head start, but it doesn’t guarantee that it wins the race. #Bitcoin = Myspace, #Dogecoin = Facebook, _______ = Instagram, ______ = ______. Nothing will ever equal #gold!
— Peter Schiff (@PeterSchiff) February 7, 2021
Be the first to comment