Deribit, a cryptocurrency derivatives exchange, is set to introduce Bitcoin volatility futures, providing investors with a means of assessing and engaging in trading the BTC market.
Deribit’s New Product Allows Investors To Trade BTC
Deribit’s BTC DVOL futures is a derivative contract based on the Deribit BTC Volatility Index. The index evaluates the implied volatility of the flagship digital currency, BTC, and offers a 30-day forecast of investors’ expectations for volatility annually.
Like other volatility instruments, BTC DVOL can aid traders with market speculation, portfolio hedging, or risk management. In traditional finance, volatility-as-an-asset is extensively traded, and the Chicago Board’s Options Exchange Volatility Index (VIX) is the most prevalent product.
The VIX varies on a scale of 1 to 100, with the historical average being 20. Additionally, the VIX gauges the fluctuation of S&P 500 index options, a principal indicator of the US stock market.
In the past year, the traditional markets have witnessed significant volatility, characterized by major volatilities in the S&P 500 index and the overall stock market. BTC and the wider crypto markets have displayed huge volatility in the past year.
The “crypto winter” time is usually related to sharp declines in digital asset prices following an extended bullish season.
Even though crypto investment products suffered unprecedented outflows last week due to the downfall of Signature Bank and Silicon Valley Bank, Bitcoin experienced a significant rebound due to regulatory clarity on investors’ deposits.
For the first time in about nine months, Bitcoin’s price surged past $28,000.
Cryptos Provide A Secure Refuge Amidst Bank Crisis – ARK Invest CEO
Amid the turmoil caused by several bank runs in the US, the CEO of ARK Invest, Cathie Wood, stated that cryptocurrencies had provided a secure refuge amidst the persistent bank crisis in the country.
However, she attributed the Federal Reserve’s policy failures as the cause for the recent downfall of these US banks. Wood took to Twitter and criticized the Federal Reserve’s inability to prevent bank runs, despite clear warning signs.
She expressed her disappointment that banks and regulators could not persuade the Fed of the imminent disaster.
Besides, the ARK Invest CEO attributed the ongoing banking crisis to a lack of venture capital funding caused primarily by the Federal Reserve’s policies. In addition, Wood highlighted that cryptocurrencies did not instigate the ongoing crisis in the banking sector.
Regulators have closely monitored the crypto space following the FTX collapse. This has led to increased regulatory enforcement in recent months.
According to the CEO, regulators unfairly blame crypto for their inadequate supervision of conventional banking practices.