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Analysis: Bitcoin’s volatility falls to its lowest level since 2016, sustained deleveraging reduces liquidation risks

2026.07.22 16:46:51

Crypto Quant analyst Axel Adler Jr noted in a post that Bitcoin has recently entered a low-volatility compression phase. The 30-day average of its 1-week realized volatility has fallen to 28.3, a roughly 31% drop from the June 25 peak of 41.6. The metric has also retreated to around the 8th percentile of its historical distribution since 2016, meaning 92% of past trading days saw higher volatility than current levels. Meanwhile, Bitcoin’s 30-day momentum of open interest (OI) relative to market capitalization has been negative for 21 consecutive days, signaling market leverage is continuing to decline rather than accumulating amid the low-volatility environment. The cryptocurrency’s current price has rebounded approximately 11.4% from its June low, but this uptick has not been paired with an expansion of derivative positions, reducing the risk of a large-scale liquidation cascade. However, Bitcoin remains below its 200-day moving average of $72,666. If volatility rises back above 35 while the price fails to hold above the long-term moving average, downside risks could increase.

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