Cboe Global Markets plans to introduce a new bitcoin volatility benchmark, the Cboe IBIT Volatility Index (BITVX), designed to measure expected price swings in the cryptocurrency market.
The Chicago-based exchange operator said the index will launch on March 23 and track the market’s anticipated 30-day forward volatility using options linked to the Ishares Bitcoin Trust ETF.
“With the new BITVX Index, we’re taking the proven framework of Cboe’s VIX Index methodology and applying it to bitcoin, giving the market a transparent, rules-based benchmark for expected volatility derived from IBIT options activity,”
Said Cboe global head of derivatives, Rob Hocking.
BITVX will apply the same methodology used by Cboe’s VIX Index, widely known as Wall Street’s “fear gauge,” which measures expected volatility in U.S. equities through options pricing.
To calculate the index, Cboe will analyse options tied to the Ishares Bitcoin Trust ETF with weekly Friday expirations and two maturities designed to maintain a constant 30-day outlook.
The methodology extracts implied volatility from a broad range of out-of-the-money options, producing what the exchange describes as a model-free estimate of near-term market expectations.
The launch reflects growing demand for regulated bitcoin derivatives as institutional investors increasingly use ETF-linked options to gain exposure to digital assets within traditional financial markets.
At the time of reporting, Bitcoin price was $69,144.82.