The cryptocurrency market has been relatively stagnant lately, with Bitcoin (BTC) trading within a narrow price range. Could this be the calm before the storm?
The Crypto Volatility Index (CVI) is currently at near-historic lows. If you anticipate increased market volatility, you can leverage CVI to generate profits—without needing to predict price direction.
What Is the Cryptocurrency Volatility Index (CVI)?
CVI is the cryptocurrency equivalent of the VIX (Volatility Index). Developed by COTI Network in collaboration with Dan Galai (co-creator of the original VIX), it serves as a "fear gauge" for crypto markets.
CVI Ranges:
- 0–85: Low volatility
- 85–105: Moderate volatility
- 105–200: High volatility
How to Profit from CVI
1. Bet on Volatility
If you expect volatility to rise, you can acquire CVOL Tokens, which track CVI’s performance:
- Purchase directly via the CVI platform or decentralized exchanges like SushiSwap.
- Caution: CVOL Tokens incur funding fees—higher when CVI is low—via daily negative rebasing (reducing your token balance).
👉 Best practices for trading CVOL Tokens
2. Become the "House"
Deposit USDC into the Theta Vault:
- Acts like a counterparty to volatility traders (similar to $GLP in GMX).
- Offers ~36% APY, but carries risk if CVI surges abruptly.
- Long-term, vaults historically outperform (e.g., $GLP’s track record).
Key Takeaways
- CVI is a groundbreaking DeFi primitive, offering new ways to hedge or speculate.
- The team’s innovative roadmap suggests strong growth potential.
FAQ
Q1: Is CVI only for Bitcoin?
A: No—it aggregates volatility across major cryptos (e.g., ETH, SOL).
Q2: How often does CVI update?
A: It recalculates in real-time based on options market data.
Q3: Can I lose money with CVOL Tokens?
A: Yes, if volatility stays low, rebasing erodes holdings.
Q4: What’s the minimum deposit for Theta Vault?
A: Typically $100+ in USDC, but check platform details.
👉 Advanced CVI strategies for 2025
Disclaimer: Trading involves risks. Conduct independent research before investing.