Bitcoin Volatility Drops to 42%, Traders Shift to AI Stocks

On August 19, the 30-day realized volatility of Bitcoin fell to around 42%, marking a multi-year low, while the volatility of the S&P 500 index was approximately 18%, resulting in the smallest historical volatility gap between the two. The market is at a standstill, with companies and mining firms selling off limiting the upside potential, while deleveraging and accumulation by long-term holders restrict the downside. Some short-term traders have shifted their risk appetite towards AI stocks, tokenized stocks, perpetual contracts, and prediction markets. According to NYDIG research, short-term traders are more inclined to chase volatility and potential returns, with those seeking 5x or 10x returns able to choose between Bitcoin, Nvidia, gold, perpetual stock contracts, 0DTE options, and sports event contracts. Data shows that the monthly trading volume of traditional asset perpetual contracts on crypto trading platforms increased from $52 billion in January to $268 billion in June, a growth of over 5 times in six months. Meanwhile, retail traders in South Korea have noticeably shifted from cryptocurrencies to AI-related stocks, with trading volumes on major South Korean crypto exchanges dropping by about 80% year-on-year. CoinDesk points out that the Bitcoin market is currently in a "dormant" state, with decreased trading participation, reduced market depth, and regulatory uncertainty collectively suppressing volatility. If there is substantial progress in U.S. crypto regulation or changes in the macro environment, the current low-volatility pattern may be disrupted, and thinner liquidity could further amplify price fluctuations.