October 17th, the BitVol (Bitcoin volatility) index launched by financial index company T3 Index in conjunction with Bitcoin options trading platform LedgerX rose to 42.6, a daily increase of 9.23%. BlockBeats Note: The BitVol index measures the expected implied volatility of 30 days obtained from tradable Bitcoin options prices. Implied volatility refers to the volatility implied by the actual option price.
It is the volatility inferred by using the B-S option pricing formula, and substituting the actual option price and other parameters except for the volatility σ into the formula. The actual price of the option is formed by the competition of many option traders, so the implied volatility represents the market participants' views and expectations of the future market, and is therefore regarded as the closest to the true volatility at that time.
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