Resolution Criteria

This market resolves to YES if the Bitcoin Volatility Index (BVOL) reaches or exceeds 30 at any point before May 1st, 2024. It resolves to NO if the BVOL remains below 30 until May 1st, 2024.

Background

The Bitcoin Volatility Index (BVOL) is a measure of Bitcoin's implied volatility, similar to how the VIX measures expected volatility in the S&P 500. The BVOL is calculated based on Bitcoin options prices and represents the market's expectation of 30-day forward-looking volatility.

As of late April 2024, Bitcoin's implied volatility (as measured by indices like DVOL) has been decreasing from around 80% to 70% on an annualized basis, reflecting reduced demand for downside protection options. This contrasts with Bitcoin's typical volatility pattern, which tends to increase during price rallies and decrease during pullbacks.

Considerations

Unlike traditional markets where volatility often spikes during downturns, Bitcoin's implied volatility is positively correlated with its price. For Bitcoin's volatility to reach a level comparable to the VIX's 30, significant market stress or a sharp price movement would likely be needed before the May 1st deadline.