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Ethereum Volatility Time Series

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Frequently Asked Questions

What is The Ethereum Volatility Index?

This site tracks the volatility of the Ethereum price in US dollars.

What is volatility?

Volatility is a measure of how much the price of a financial asset varies over time.

Why is volatility important?

Volatility means that an asset is risky to hold—on any given day, its value may go up or down substantially. The more volatile an asset, the more people will want to limit their exposure to it, either by simply not holding it or by hedging. Volatility also increases the cost of hedging, which is a major contributor to the price of merchant services. If Ethereum volatility decreases, the cost of converting into and out of Ethereum will decrease as well.

What definition of volatility does The Ethereum Volatility Index use?

The standard deviation of daily returns for the preceding 30- and 60-day windows. These are measures of historical volatility based on past Ethereum prices. When the Ethereum options market matures, it will be possible to calculate Ethereum's implied volatility, which is in many ways a better measure.

How volatile is Ethereum relative to gold and other currencies?

For comparison, the volatility of gold averages around 1.2%, while other major currencies average between 0.5% and 1.0%.

The chart above shows the volatility of gold and several other currencies against the US Dollar. Series marked with an asterisk are not directly comparable to series not so marked because fiat currency markets are closed on weekends and holidays, and therefore some price changes reflect multiple-day changes. Such multi-day changes in price are excluded from analysis, and therefore, the 30- and 60-day metrics for these series use fewer than 30 and 60 data points. They are presented for entertainment purposes only.

Do you have pages for other currencies?

Yes! You can check out our Bitcoin Volatility Index and our Litecoin Volatility Index. We are working on more soon!

Why is Ethereum more volatile than Bitcoin and Litecoin?

Bitcoin launched in 2009, while Litecoin was released in 2011. Ethereum was only launched in 2014, meaning it is 5 years younger than Bitcoin and 3 years younger than Litecoin. Ethereum's markets and trading is actually very liquid, but it appears price discovery is happening very quickly with Ethereum since it is just establishing its price.

What is the pricing source?

The Ethereum Volatility Index is powered by Coin Market Cap for Ethereum prices, and by FRED® for other series pricing data.