COVID-19 Outlook: Bitcoin’s Volatility To Spike Further In Q2 2020 After Setting Record Levels In March

By Lujan Odera
April 4, 2020 Updated April 4, 2020
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Image Courtesy of Public Domain Pictures

The past three months of the year have been a rollercoaster ride across the world as the COVID-19 pandemic set the global assets and economies at a standstill or regressing pattern. Assets across the board including stocks, gold and Bitcoin (BTC) have suffered during this time setting record volatility levels across the month of March.

Over the past 30-days, the S&P 500 volatility reached an all-time high in the average daily volatility recording 4.82%. While remaining relatively stable during the capitulation in asset markets, gold still set its highest 30-day average volatility witnessing an average of 2.36% – highest since September 2011.

As it has become customary, Bitcoin has historically seen high volatility and March was no different as the top crypto set its highest volatility since the end of 2013.

BTC 30-day volatility hits five year high

Bitcoin (BTC) volatility set a five year high on its 30-day average volatility as the asset faced one of its most volatile months as the fears of COVID-19 grew out of proportion. According to data aggregator, Buy Bitcoin Worldwide, the 30-day volatility on BTC/USD averaged 10.86% at the end of March, the highest it’s been since December 2013, when it reached 12.56%.

Bitcoin and Gold record volatility levels (Image: BBWW)

In the middle of the confusion and scare of government lockdowns and collapsing economies, the price of BTC collapsed from $8,000 region to below $3,800 in a matter of minutes on Mar. 12 during the Black Thursday crash. Shortly after losing over 50% of its value in the process, BTC grew to $6,000 setting one of the most volatile days in BTC’s history yet.

Volatility set to continue deep into Q2

Bitcoin (BTC) bulls are however hopeful for a possible recovery of the coin in this quarter given Q2 has historically been the best performing quarter of the crypto. Notwithstanding, the upcoming halving in May will halve the block rewards from 12.5 BTC to 6.25 BTC reducing the supply rate.

With Coronavirus pandemic also affecting Bitcoin mining operations, the volatility is set to spike further as we head towards the halving.

Been in the field since 2015 and he still love everything blockchain and crypto! FC Barcelona fan. Author and journalist. Follow him at @lujanodera.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

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