Bitcoin (BTC) has long been known for its extreme volatility, with its price historically doubling or halving within just a few months. But this may be changing.
According to TradingView data, Bitcoin’s 30-day realized volatility is currently at 42%, remaining below 50% this month. In comparison, South Korea’s benchmark index, the Kospi (with a market cap roughly twice that of Bitcoin), reached a volatility of 74% last week and remains around 51%. Another highly volatile stock market is Pakistan, where the KSE 100 index also exhibits a volatility of approximately 51%.
The volatility of Bitcoin (a measure of price fluctuations) has steadily declined in recent years, especially after the launch of spot ETFs in the United States in January 2024. These investment instruments have increased institutional participation and introduced more risk-managed capital flows, helping to dampen price volatility.
Bitcoin's relative stability highlights its appeal as a geopolitical hedge, maintaining value even when macro forces like war severely disrupt traditional assets. Historically, Bitcoin has outperformed gold, the S&P 500, and other traditional assets during times of war. River, a financial institution that accepts only Bitcoin, pointed out earlier this month.
However, during this period, volatility in most major regional markets and their global counterparts was lower than that of Bitcoin. This raises the question: why is Korea— the world’s fourteenth-largest economy—different?
Korean issue
The Korean stock market exhibits high volatility, largely reflecting fluctuations in fossil fuel prices, but this has little to do with Bitcoin.
The Korea Composite Stock Price Index (KOSPI) fell from 6,340 points in late February to 5,000 points by the end of March, then rebounded to a new historical high above 6,380 points.
The initial sell-off occurred before the outbreak of war between Iran and the U.S.-Israel alliance, which began on February 28 and ultimately led to the closure of the Strait of Hormuz—a vital oil supply route. Since South Korea relies on imports from the Middle East for virtually all its fossil fuels, including oil and natural gas, this disruption and the resulting surge in oil prices dealt a severe blow to South Korea.
Later, as tensions eased and both sides reached a temporary ceasefire agreement, the index gradually stabilized. Expires Wednesday The Pakistani stock market also experienced similar volatility, as its economy is similarly vulnerable to energy market disruptions, possibly even more so.
During this period, Bitcoin's price remained relatively stable, primarily fluctuating between $65,000 and $75,000, supported by renewed inflows of funds from U.S.-listed spot exchange-traded funds (ETFs).