BitVol Index, a measure of Bitcoin volatility launched by T3 Index and LedgerX, rose 5.96% to 62.55 on October 30. The index calculates 30-day expected implied volatility based on tradable Bitcoin options prices.
Implied volatility is derived from actual option prices using the BS option pricing formula, with volatility σ being the only unknown parameter. This metric represents market participants’ expectations for future market trends, formed by competition among option traders. As such, implied volatility is considered the most accurate representation of true volatility at a given time.
The BitVol Index is a joint initiative between financial index company T3 Index and options trading platform LedgerX, tracking market sentiment and expectations through Bitcoin options prices.
