Bitcoin volatility has dropped to historic lows: there will never be another frenzied bull run or a despairing bear market.

Author: Cointelegraph

Compiled by: White55, Mars Finance

Blockware BTC analyst Mitchell Askew stated that Bitcoin will no longer experience "parabolic" price increases or "devastating" bear markets, as the BTC exchange-traded fund (ETF) has permanently reduced volatility and changed market dynamics.

"BTC/USD looks like two completely different assets before and after the ETF," the analyst wrote on Friday. The chart he shared shows that after the Bitcoin ETF launches in the U.S. in January 2024, price volatility drops sharply. The analyst stated:

"The days of parabolic bull markets and devastating bear markets are over. In the next 10 years, BTC will reach 1 million dollars through continuous oscillations between 'uptrends' and 'consolidations'. It will annoy everyone along the way and shake tourists off their positions."

After the launch of Bitcoin ETF in the United States, the price movement of Bitcoin has shown more stable price fluctuations.

Bloomberg ETF senior analyst Eric Balchunas wrote that the reduction in volatility has helped Bitcoin "attract bigger fish and gives it a chance to be adopted as a currency." The analyst added that the cost of doing so may mean that there will no longer be "God candles."

The impact of Bitcoin ETFs on market dynamics continues to be a topic of debate among market analysts, as this investment tool further intertwines traditional finance, institutional investors, and the digital asset market.

Bitcoin ETF Changes Cryptocurrency Market Dynamics

Bitcoin ETFs will isolate capital into traditional investment tools that currently lack physical redemptions, keeping funds off-chain.

This accumulation of capital can hinder the rotation towards altcoins, which is the expectation of cryptocurrency investors regarding previous market cycles.

In July, net inflows into Bitcoin ETFs surpassed $50 billion, although the surge in Bitcoin capital did not translate into an increase in on-chain activity.

Analysts say that retail investors are turning to Bitcoin ETFs and gaining exposure through fund managers or other financial fiduciaries holding traditional financial instruments on their behalf, rather than directly holding BTC.

The demand for paper BTC and BlockRock Bitcoin ETFs and other products has led this asset management company to accumulate 3% of the total Bitcoin supply, raising concerns among some market participants about centralization.