Crypto Daybook Americas: Bitcoin Volatility Near 2-Year Low Is IBIT’s Gain, Strategy's Pain
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By James Van Straten (All times ET unless indicated otherwise)
If there was any doubt that popular interest in bitcoin BTC is on the wane as the price treads water just below its record high, a quick peek at Google's search trends provides the evidence.
Searches for the largest cryptocurrency now rank below 25, a sign of significant absence of retail interest, euphoria or speculative greed in the market with BTC holding between $102,000 and $110,000 for most of the past month. Compare that to the ranking of as high as 40 it hit during November's rally, when bitcoin surged to nearly $100,000.
This subdued interest coincides with historically low volatility levels. The Bitcoin Volatility Index (DVOL) is hovering just above 40, one of the lowest readings in over two years, beaten only by trough of mid-2023.
Deribit's implied volatility metrics further emphasize the market’s stagnation: The IV Rank, which shows how current implied volatility compares with the past year, is at just 2.3, close to its lowest point of the year, and the IV Percentile is at an astonishing 0.3, indicating that implied volatility has been lower than this level less than 1% of the time over the last 12 months.
This lack of movement has prompted Strategy (MSTR), a company heavily exposed to bitcoin’s price action, to issue new perpetual preferred equity rather than tapping its at-the-market offering of common stock, a strategy aimed at keeping its multiple net asset value (mNAV) above 1.
Meanwhile, the iShares Bitcoin Trust (IBIT) is benefiting from the reduced volatility, attracting more traditional and conservative investors who prefer stable exposure to bitcoin without the wild price swings.
All eyes now turn to the U.S. jobs report scheduled for Friday, which could serve as the next major market catalyst. Expectations are for the unemployment rate to hold steady at 4.2%, while non-farm payrolls are projected to come in at 130,000, the weakest figure since February. Any deviation from these estimates could spark renewed volatility across markets. Stay alert!
What to Watch
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Crypto
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June 4, 10 a.m.: U.S. House Financial Services Committee will hold a hearing on “American Innovation and the Future of Digital Assets: From Blueprint to a Functional Framework.” Livestream link.
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June 6: Sia (SC) is set to activate Phase 1 of its V2 hard fork, the largest upgrade in the project’s history. Phase 2 will get activated on July 6.
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June 9, 1-5 p.m.: U.S. SEC Crypto Task Force roundtable on "DeFi and the American Spirit"
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June 10, 10 a.m.: U.S. House Final Services Committee hearing for Markup of Various Measures, including the crypto market structure bill, i.e. the Digital Asset Market Clarity (CLARITY) Act.
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June 16 (market open): 21Shares executes 3-for-1 share split for ARK 21Shares Bitcoin ETF (ARKB); ticker and NAV remain unchanged.
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Macro
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June 4, 9 a.m.: S&P Global releases May Brazil data on manufacturing and services activity.
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Composite PMI Prev. 49.4
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Services PMI Prev. 48.9
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June 4, 9:45 a.m.: S&P Global releases (final) May U.S. data on manufacturing and services activity.
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Composite PMI Est. 52.1 vs. Prev. 50.6
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Services PMI Est. 52.3 vs. Prev. 50.8
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June 4, 10 a.m.: The Institute for Supply Management (ISM) releases May U.S. services sector data.
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Services PMI Est. Est. 52 vs. Prev. 51.6
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June 5, 8:30 a.m.: The U.S. Department of Labor releases unemployment insurance data for the week ended May 31.
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Initial Jobless Claims Est. 235K vs. Prev. 240K
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Continuing Jobless Claims Est. 1910K vs. Prev. 1919K
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Earnings (Estimates based on FactSet data)
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None in the near future.
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