Traders have shifted some macroeconomic risks into metal markets, reflected in volatility changes: silver's realized volatility rose to the mid-50% range, while bitcoin's dropped to the mid-40% range. Meanwhile, silver's price increased over 151% in a year, whereas BTC's price declined nearly 7% over the same period. These figures indicate that the markets are sending fundamentally different signals for the two assets.
Silver and Bitcoin Volatility: Current Situation
According to TradingView data, bitcoin's annualized 30-day realized volatility has steadily decreased over the past month to the mid-40% range; at 45%, it is notably below the 365-day average. In contrast, silver's realized volatility climbed to the mid-50% range, reflecting larger actual price fluctuations in the metal. This divergence in volatility aligns with the differing price dynamics and helps explain where traders are reallocating positions.
Given bitcoin's weakness and precious metals' rise, it is important to examine the reasons behind risk redistribution and market sentiment shifts—this also clarifies why some capital has moved into metals in anticipation of alternative scenarios. For a detailed analysis of bitcoin's weakness, see the article on why bitcoin is weakening amid gold and silver gains.
Reasons Behind Silver's Volatility Increase
Silver's volatility growth is linked to a real physical metal shortage and sharp shifts in market supply and demand. Demand from solar panel manufacturers, electric vehicle producers, electronics, and battery technologies has surged, while supply lags, intensifying price swings.
- Supply-demand imbalance: industrial demand has grown faster than supply, putting upward pressure on prices.
- Regulatory factor: China began licensing silver exports on January 1, heightening expectations of reduced physical availability.
- Premiums and market structure: prices in Shanghai and Dubai exceed COMEX quotes by $10–14, and the London forward curve has moved into deep backwardation—a sign of near-term metal scarcity.
Factors Affecting Bitcoin Volatility
Bitcoin faces several technical and market factors that dampen volatility and keep prices range-bound. Traders link the ongoing price decline to reduced demand for spot ETFs and a weakening narrative around DAT; additionally, events have directly impacted liquidity.
QCP Capital's analytical note highlights that liquidity reduction during the holiday period intensified short-term fluctuations, and the expiration of large options altered dealer positions. QCP added that about 50% of open interest disappeared after option expirations, leaving a significant amount of capital sidelined and increasing uncertainty. More on option expiration impacts can be found in the article about option expiration effects.
Market Forecasts and Expectations
Prediction markets and betting platforms reflect differing perceptions of the two assets: on Polymarket, bets tied to silver prices at the end of January show strong confidence in maintaining high prices and a low chance of sharp declines. Meanwhile, bitcoin markets mostly price in continuation within the current range.
Traders estimate about a 70% probability that bitcoin will hold above $86,000 in early January, while chances of breaking above $92,000 fall below 25%. At the same time, bitcoin trades nearly 30% below its record high exceeding $126,000 reached in October.
Why This Matters
If you mine cryptocurrency, volatility fluctuations primarily affect the asset's price and conditions for converting to fiat or rubles. The liquidity drop reported by QCP Capital can amplify short-term price spikes during large sales, and the significant reduction in open interest makes price movements less predictable in the short term.
Meanwhile, silver's rising volatility and physical metal shortage are unlikely to directly alter mining operational conditions but reflect a broader capital redistribution process that may shift risk appetite and influence cryptocurrency demand in a wider context.
What to Do?
Below are practical steps for miners with 1–1000 devices in Russia: concise recommendations to help reduce operational and price risks.
- Monitor exchange liquidity during major expirations: avoid large market sales when liquidity is low.
- Stagger sales over time and volume to prevent dumping the entire mining output at once and triggering price crashes.
- Maintain a reserve for expenses (e.g., electricity and maintenance) in an asset you can sell gradually to avoid dependence on short-term volatility spikes.
- Stay informed about metal market news and regulatory changes (such as China's silver export licensing) if your portfolio includes precious metals.