Ethereum volatility continues: Investors pulling back?

Fibo Quantum

The queen of cryptocurrency is going through a troublesome turmoil while the Ethereum volatility continues to surge to new levels. The world of cryptocurrency is carefully knitted around the weaves of blockchain, politics, and people above all.

The very decentralized nature of the Ethereum blockchain is where the story began, but as the Ethereum 2.0 change approaches market volatility and, in turn, Ethereum volatility is only increasing.

Ethereum volatility and investor interest

Bitcoin, without any doubt, is one of the major factors that influence any other cryptocurrency being dubbed the king of cryptocurrency for not only being the pioneer but also the largest cryptocurrency by market capitalization. Bitcoin price movement is very shaky, where some believe it might hold the current trend has been of new lows. This, in addition to the fast-approaching Bitcoin halving event, has been tantamount to the increased market volatility.

On the other hand, the fear of the Ethereum 2.0 shift is also a challenge for the Ethereum Foundation. The shift to proof of stake (PoS) Ethereum 2.0 has been delayed already but believed to be approaching.

Skew reports that investor interest has been on the decline while the volatility is on a new rising tide. Previously, a few weeks back, the volatility had surpassed all cryptocurrencies at one point. However, the steep decline or a “flash crash” in Ethereum investor interest in options fell at the end of February and has been dwindling below $50m mark.

Ethereum Volatility - Skew Realized vs Implied Volatility

While on the other hand, the realized volatility line superseded the implied volatility line a couple of days back is a clear sign of increase Ethereum volatility. This volatility also translates into a very confusing state for investors, thus disturbing the Ethereum market sentiment and the Ethereum investor interest.

Ethereum has been shredding price value very rapidly in the past few days as Bitcoin took a downward plunge. A more stable market position may be able to help Ethereum’s adaptability back to previous levels.

Featured Image by Macondoso