The MOVE index, which measures expected volatility in U.S. Treasury markets, jumped about 33% over two trading days from Sept. 22 to 24. It closed at 104.58, hitting a new high since the end of March. The Bitcoin options market didn’t follow suit. Deribit’s volatility index, DVOL, fell over the same period, dropping again to about 34.3 on Sept. 26, close to this year’s low of 33.59. (Background: Bitcoin fell below $83,000, and U.S. Treasury yields hit a 19-year high at 5.11%.) (Additional context: Will the Fed raise rates three times in a row? A warning sign from the 1989 playbook.) Key takeaways: MOVE rose about 33% over two trading days to 104.58, its highest level since late March. Bitcoin’s DVOL slid to about 34.3, near the yearly low of 33.59 on Sept. 17. Bitcoin’s 30-day realized volatility is about 42%, higher than the 34% implied by options. U.S. Treasury markets suddenly turned tense this week. Based on U.S. Treasury Department and Deribit data compiled by the ICE exchange, the MOVE index closed at 78.56 on Sept. 22 and climbed to 104.58 on Sept. 24. A gain of roughly 33% in two trading days—its biggest since March 30. MOVE estimates expected volatility over the next month from pricing of Treasury options, often referred to as the “bond-market VIX.” Higher numbers mean more people are paying for rate hedges. Bitcoin options moved in the opposite direction. Deribit’s Bitcoin volatility index, DVOL, fell from 37.4 to 36.04 during the same period. By late evening in Taipei time on Sept. 26, DVOL dropped further to about 34.3. This year’s low was 33.59 on Sept. 17, only about 0.7 apart. Meanwhile, Bitcoin was quoted around $83,966, up 3.34% over the past seven days. MOVE fell back to 96 on Sept. 25, dropping about 8.2% in a day—still about 19% higher than 80.64 a week earlier. DVOL did not rebound; it fell for two straight days. Ten-year yields rose 22 basis points The tension in the bond market is driven by the sharp spike in yields. U.S. Treasury data show the 10-year Treasury yield was 4.96% on Sept. 22, rising to 5.18% on Sept. 24. It climbed 22 basis points over two days, then edged back to 5.17% on Sept. 25. FRED data from the St. Louis Fed show this is the highest level since July 2007. Over the same period, the 30-year yield rose from 5.29% to 5.47%, and then increased again to 5.49% on Sept. 25, matching levels from June 2004. In a prior report, 動區 previously noted that CME FedWatch shows traders expect the Fed to raise rates four more times even through June 2027. As rate expectations get revised higher, Treasury prices fall accordingly. MOVE’s highest point this year was 115.02 on March 26. During the tariff shock period on April 8, 2025, it even reached 139.88. This time, the pace of the rise was relatively fast: up by about 30% in two days, and up 21.5% in a single day on Sept. 23. U.S. stocks edged higher, but Bitcoin options got cheaper The demand for hedging in U.S. equities rose only slightly. VIX, which measures expected volatility for the S&P 500, closed at 14.21 on Sept. 22, the lowest this year. It rose to 15.67 on Sept. 24, an increase of about 10%, and returned to 14.87 on Sept. 25. The percentage increase in VIX was roughly one-third of MOVE’s. DVOL represents Bitcoin options’ implied annualized volatility over the next 30 days. Converting 34.3 into a daily figure, it works out to the market expecting Bitcoin to move up or down by about 1.8% per day. DVOL’s highest this year was 82.62 on Feb. 5; today’s level is less than half of that. Using the closing values from Aug. 28 to Sept. 25 (20 trading days), the correlation between MOVE and DVOL is about negative 0.42. This suggests that on days when bond-market volatility tends to rise, Bitcoin’s implied volatility usually moves lower. Bitcoin’s actual price moves bigger than what options pricing implies. Realized volatility is calculated from actual closing prices (the realized move), while implied volatility is inferred from option prices (the market’s expectation). Based on Binance daily closing prices, Bitcoin’s realized volatility over the past 30 days is about 42%, and over the past 14 days about 48%—both higher than DVOL’s 34.3. On Sept. 15, Bitcoin still closed at $75,644, and it has risen about 11% since then. From Sept. 19 to 21, it climbed from $81,250 to $86,620—up 6.6% in two days—then slipped back toward the $84,000 area. When implied volatility is below realized volatility, it means the cost to buy Bitcoin options for hedging is relatively low compared with the magnitude of moves seen over the past month. $81,178 and $86,620 bound this week’s range Bitcoin closed at $81,178 on Sept. 20 and at $86,620 on Sept. 21; the latter was the highest close since July. If it falls below $81,178, last week’s gains would all be given back; if it reclaims $86,620, it would break out of the top of this trading range. Within two days, the bond market raised hedging prices by 30%, while U.S. stock hedging costs rose by 10%, yet Bitcoin options pricing is even lower than what the actual price action suggests. If MOVE reclaims above 100 and the 10-year yield also holds above 5.1%, the next question is whether DVOL will move away from this year’s lows. Only when DVOL starts trending upward would it indicate that the Bitcoin options market has priced in interest-rate risk. FAQ What is the MOVE index, and how much did it rise? MOVE is compiled by ICE; it’s derived from Treasury option prices to estimate expected volatility over the next month, known as the “bond-market VIX.” It closed at 104.58 on Sept. 24, up about 33% over two trading days. What does Bitcoin DVOL 34 mean? DVOL is Deribit’s implied annualized volatility for the next 30 days calculated from Bitcoin options. Around 34.3 is equivalent to the market expecting daily up/down moves of roughly 1.8%, near this year’s low of 33.59. Related coverage: Traders bet on Fed hiking 4 more times next year; Bitcoin breaks below $83,000; Treasury yields surge. Didn’t catch up to Bitcoin’s rally? Traders recommend entering with “call spread” options. If you miss just 5 days, do you lose 36%? Bitcoin’s historical data delivers a brutal win-lose game for “timing players.” “Bond panic index surges 33%! Bitcoin volatility falls toward the yearly low?” This article was first published on 動區BlockTempo (動區動趨 — the most influential blockchain news media).