XRP's Implied Volatility Explodes, Suggests 13% Price Swing as Congress' Crypto Week Kicks Off
Volmex Finance's seven-day XRP implied volatility (IV) index jumped to an annualized 96% from last week's 73%, a significant premium to the seven-day historical volatility of 42%. The elevated value translates to an expected 13% price swing for XRP over the coming seven days.
The market is pricing much lower volatility in bitcoin (BTC). The seven-day implied volatility for the largest cryptocurrency has increased only slightly to an annualized 46%, equivalent to an expected weekly price swing of about 6%.
The sharp rise in XRP's implied volatility comes as the U.S. House of Representatives is set to review three major bills this week that could shape the digital assets industry.
The first is the GENUIS Act, which, if passed, would require stablecoin issuers to hold liquid reserves, accept annual independent audits and publish monthly transparency reports.
Also on the table is the CLARITY Act, which will clarify whether cryptocurrencies fall under the SEC or the CFTC's purview. Lastly, there is the Anti-CBDC Surveillance Act, which will prohibit the Federal Reserve from issuing a retail central bank digital currency. XRP, declared as a strategic U.S. asset by the SEC, stands to benefit from regulatory clarity.
"The GENIUS Act and CLARITY Act are especially important for setting institutional ground rules — clarifying how stablecoins should be issued and overseen, and formally defining the roles of the SEC and CFTC in overseeing crypto markets. Together, these steps address one of the core barriers to institutional participation: legal uncertainty," Javier Rodriguez-Alarcón, the chief investment officer at crypto liquidity provider XBTO, said in an email.
He added that the rulebook clarity will make long-term capital deployment viable, aligning the world's largest economy with processes underway in regions like the UAE, where "defined frameworks are already unlocking tokenized markets."
"If passed, these bills could open the door to wider stablecoin adoption, regulated tokenization, and on-chain financial products with full legal backing," he noted.
Note that the implied volatility is direction-agnostic, meaning the expected 13% swing may not necessarily be bullish and can unfold in either direction.
That said, XRP is currently exhibiting strong bullish momentum, trading over 5% higher on the day at $3, the level not seen since early February, according to CoinDesk data.
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