BTC Volatility Hit Historic Lows as ETF Inflows Transformed Market Dynamics: Bybit & Block Scholes Monthly Report
Bybit, the world's second-largest cryptocurrency exchange by trading volume, released the latest monthly volatility report in collaboration with Block Scholes. The comprehensive analysis of June 2025 revealed that BTC had entered historically low volatility territories driven by significant spot ETF inflows. BTC's implied volatility is dropping to just 28%, with realized volatility hitting levels not seen in nearly 20 months.
Institutional investment, the report noted, is fundamentally reshaping BTC's price behavior and creating a more stable trading environment, departing from its historical pattern through spot ETFs. The report covers trading data in June and is released as BTC momentarily touched a new all-time-high of $120K overnight.
Key Insights:
BTC Market Matures as Volatility Drops: BTC's implied volatility has reached a remarkable milestone, reaching the lowest level since October 2023 and well below the significant 30% threshold. This dramatic decline continues a downward trend that began in 2020, reflecting growing asset maturity as BTC gains mainstream acceptance. The report shows that both implied and realized volatility have dropped simultaneously, with realized volatility hitting 22-25% at 20-month lows, creating exceptional calm that persists even amid broader macroeconomic turbulence.
The 'ETF Effect' Stabilized BTC Prices: The analysis reveals a clear correlation between the January 2024 launch of US spot BTC ETFs and the subsequent volatility decline, with ETF flows appearing to stabilize BTC's price movements and create more frequent small, positive daily returns as institutional buyers help soften sell-offs and anchor demand. The data shows that 2025 has demonstrated a notable shift toward smaller, more positive daily price movements, indicating that institutional ETF buyers are providing consistent support during market downturns and creating a more stable price floor. This stabilization mechanism has resulted in fewer and milder volatility spikes compared to BTC's pre-ETF era, fundamentally altering the cryptocurrency's risk profile.
ETH Volatility Remains High Despite ETF Launch: While BTC experiences historic stability, ETH has not followed the same pattern despite its own spot ETF launch in July 2024, with the ETH/BTC realized volatility ratio steadily climbing since July 2024 and ranging from 1.68 to 2.34 in June, indicating ETH continues to trade with significantly higher volatility than BTC. The divergence extends beyond ETH, with Solana showing even more pronounced volatility spikes – the SOL/BTC ratio hit 2.96 in June 2025, matching January's high and representing levels not seen since January 2024. The report attributes this divergence to the relative strength of institutional demand, with BTC spot ETFs consistently representing a far larger share of total trading volume than ETH ETFs – before the 2024 US election, BTC ETF inflows were 36 times greater than ETH relative to their respective trade volumes.
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About Bybit
Bybit is the world's second-largest cryptocurrency exchange by trading volume, serving a global community of over 70 million users. Founded in 2018, Bybit is redefining openness in the decentralized world by creating a simpler, open, and equal ecosystem for everyone. With a strong focus on Web3, Bybit partners strategically with leading blockchain protocols to provide robust infrastructure and drive on-chain innovation. Renowned for its secure custody, diverse marketplaces, intuitive user experience, and advanced blockchain tools, Bybit bridges the gap between TradFi and DeFi, empowering builders, creators, and enthusiasts to unlock the full potential of Web3. Discover the future of decentralized finance at Bybit.com.
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