What are the factors that can affect the IV (implied volatility) of digital currencies and its corresponding percentile?

1 answers

• Mar 19, 2022 · 3 years ago
  At BYDFi, we believe that the factors influencing the implied volatility (IV) of digital currencies and its corresponding percentile are primarily driven by market demand and investor sentiment. When there is high demand for digital currencies and positive sentiment in the market, the IV tends to increase as investors anticipate higher price fluctuations. Conversely, when there is low demand and negative sentiment, the IV tends to decrease. Additionally, news and events related to digital currencies, such as regulatory announcements or security breaches, can also have a significant impact on the IV and percentile. These events can create uncertainty and volatility in the market, leading to higher IV. It's important for traders and investors to stay informed about these factors and monitor market conditions to make informed decisions.
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