In the world of cryptocurrency options trading, understanding implied volatility (IV) is crucial for making informed decisions. Implied volatility represents the market's expectation of how volatile an asset will be in the future. In this guide, we'll delve into what implied volatility is, why it matters in options trading, and how it specifically impacts bitcoin and ether options trading.

What is implied volatility?

Implied volatility is a measure derived from the prices of options. It reflects the market's consensus on the future volatility of an underlying asset over the option's lifespan. High implied volatility suggests that traders expect significant price fluctuations, while low implied volatility indicates expectations of relatively stable prices.

Unlike historical volatility, …