Right now, the Bitcoin bullish run is astonishing, making the cryptocurrency markets are highly volatile with the price of the bitcoin fluctuating. The market watchers are keenly monitoring the Bitcoin movement, using various resources.
BVIX, a Bitcoin Volatility Index, launched by CryptoCompare, is making waves in the crypto circuits.
crypto Compare brings BVIX with the University of Sussex
CryptoCompare launched the Bitcoin Volatility Index, which the company developed in association with the University of Sussex Business School. The cryptocurrency experts at the business school prepared the first of its kind digital assets index would measure the volatility of the cryptocurrency based on the bitcoin option traders.
Cryptocompare touted the BVIX as the first benchmark index to quantify bitcoin volatility on a press release on its website.
The market behavior and potential trend are estimated based on the standard practice of calculation of implied volatility. While the VIX indices are used for the prices of the futures contracts in the conventional markets. BVIX is used for the implied volatility of Bitcoin options.
As the institutional investments in Bitcoin increase and markets envision higher adoption of bitcoin as an ‘asset class, such tools can help the investors in decision making and price determination. They may use the index to estimate and decide the bitcoin volatility risk and exemplify the trading based on bitcoin volatility. Cryptocompare is a leading digital assets data provider that uses highly tested methods for sharing live BVIX.
Bitcoin Volatility Index currently considers only the 30 days implied volatility; Cryptocompare would roll out the support for longer durations. University of Sussex Professor Dr. Carol Alexander helped crypto Compare develop the BVIX. Carol is a Fintech veteran with expertise in blockchain, data analysis, derivative markets, and pricing. He has expertise in financial instruments, investment strategy, portfolio management, and market risk analysis. Her expertise in academics and the financial industry has helped crypt compare to develop the state of the art Bitcoin index, which can play a pivotal role in Bitcoin markets.
BVIX estimates the available bitcoin options across various exchanges providing the seemingly most precise method for determining Bitcoin implied volatility.
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