According to BlockBeats, the Bitcoin Volatility Index (BitVol), launched by financial index company T3 Index in collaboration with Bitcoin options trading platform LedgerX, rose to 59.77 on May 14, marking a daily increase of 1.72%. The BitVol Index measures the expected implied volatility derived from tradable Bitcoin option prices.
Implied volatility refers to the volatility implied by the actual option price. It is calculated by using the B-S option pricing formula, substituting the actual option price and other parameters into the formula, excluding the volatility σ. The actual price of the option is formed by the competition of many option traders. Therefore, implied volatility represents the market participants' views and expectations for the future market, and is considered to be the closest to the real volatility at that time.