A measure of Bitcoin's intraday volatility spiked on Monday, hitting its highest level since the collapse of cryptocurrency exchange FTX in 2022, as the asset's price saw its wildest swings in about 20 months.

Bitcoin’s “high-low gap” has widened to 19% amid the global sell-off, according to analysts Vetle Lunde and David Zimmerman from K33 Research.

“Yesterday’s market activity was frenetic and chaotic,” they wrote in a research note, describing the activity as “violent.”

The FTX collapse caused severe damage to the cryptocurrency market over a year ago, sending the price of Bitcoin to as low as $15,742 on November 9, 2022. Throughout the day, the asset's price peaked at $18,600 before stabilizing around $16,400 by the end of the day.

The gap between Bitcoin's high and low prices relative to Monday's close resembled the turbulence that characterized the struggles the cryptocurrency market has experienced in 2022. Meanwhile, as Bitcoin briefly dipped below $50,000 on Monday, trading volume spiked.

Bitcoin trading volume totaled $14.5 billion on Monday, the highest since early March, when the price of Bitcoin approached its previous all-time high of $69,000. Down from an all-time high above $73,000 shortly afterward, Bitcoin’s abrupt drop in March mirrored Monday’s trading activity.

Bitcoin closed around $54,000 on Monday, down 19% from $66,700 a week ago. The last time Bitcoin experienced such a steep decline in a week was when the asset fell 13% to $62,000 from around $71,000 in mid-March.

The market turmoil, which showed signs of easing on Tuesday, was attributed to growing fears of a US recession and a retreat in the Japanese yen carry trade, analysts said. Some also cited rising geopolitical tensions in the Middle East as a risk event.

Bitcoin price has recovered today to $56,650, at the time of writing. Compared to Bitcoin’s low of $49,800 on Monday, this recovery represents a 13% increase in just over a day.

Source: Coingecko

However, Lunde and Zimmerman write that Bitcoin's price is likely to fluctuate between $50,000 and $58,000 in the coming weeks. They point to a sharp drop in nominal open interest on Bitcoin perpetual futures contracts, where leveraged traders have seen a large number of bets wiped out.

Nominal open interest, which represents the outstanding value of Bitcoin perpetual futures contracts, fell 12% on Monday. This was the largest one-day drop since August 2023, when Bitcoin's price suddenly fell to $26,000 from $29,000, and nominal open interest fell 17%.

However, the decline in leveraged Bitcoin bets pales in comparison to the collapse of FTX, which eventually led to founder and former CEO Sam Bankman-Fried being convicted of fraud. On November 8, 2022, the nominal open interest in Bitcoin perpetual futures contracts fell 21%.

“Monday’s market shock was a broad market-wide sell-off and not a unique crypto market reaction,” K33 analysts wrote. “While clearing euphoric longs is a necessary and long-term positive development for the market, leveraged bailout events are often accompanied by price stagnation.”

Source: https://tapchibitcoin.io/bitcoin-chiu-dung-ngay-giao-dich-bien-dong-nhat-ke-since-khi-ftx-sup-do.html