In response to the recent increase in volatility in crypto markets, cryptocurrency exchange Bitfinex has expanded its trading tools and introduced new Bitcoin (BTC) and Ether (ETH) volatility futures. In an announcement made on April 3, Bitfinex stated that the current price of Bitcoin is $66,405 and the price of Ether is $3,342.

Bitfinex Derivatives, the derivatives platform provided by iFinex Financial, has begun trading of two new perpetual futures contracts based on the Volmex Implied Volatility indices. These indices track the 30-day expected or implied volatility rate of BTC and ETH option contracts.

According to Jag Kooner, head of derivatives at Bitfinex, the creation of these indices allows clients to not only track but also trade the implied volatility rate of Bitcoin and Ether in a simple, permanent format. Perpetual futures are derivative contracts that allow investors to speculate on the future price of an asset without a maturity date.

Kooner emphasized that perpetual futures are the most traded format in the crypto space because they are not based on a historical structure like other contracts. It opens the product to both retail and institutional investors without the need for rollup for the 30-day watch on BTC and ETH option contracts.

These new contracts complement Bitfinex’s existing offerings and include more than 60 perpetual futures contracts, covering not only cryptocurrencies but also commodities such as precious metals and oil, currencies and stocks. Kooner noted that introducing implied volatility as another asset class would enhance the platform’s offerings.

Implied volatility, an important metric in options trading, indicates the expectation of price movement of an asset over a specific period. As volatility increases, the market’s expectation of price movement increases or, conversely, decreases. Kooner explained that the timing of the introduction of these new trading tools is appropriate and that with cryptocurrency prices rising to new all-time highs, the possibility of increased volatility and a serious decline increases.

This announcement comes after cryptocurrency volatility reached all-time highs in March 2024. The Crypto Volatility Index (CVI), which tracks 30-day future volatility and serves as a “market fear index” for the crypto market, peaked at 85 points on March 11. This peak came just two days before Bitcoin reached its historic high of over $73,000 on March 13. At the time of writing, the implied volatility rate measured by CVI was around 76.