Volmex contracts from Polymarket create a fresh avenue for trading the volatility of bitcoin and ether.

Polymarket has introduced new prediction markets linked to Volmex’s bitcoin and ether 30-day implied volatility indices.

Polymarket offers contracts related to bitcoin and ether volatility. (AidanHowe/Pixabay)

Essential Information:

• Polymarket has initiated new prediction markets associated with Volmex’s bitcoin and ether 30-day implied volatility indices, enabling users to speculate on how high volatility will rise in 2026.
• The contracts will pay out if the volatility indices reach or surpass a predetermined level by December 31, 2026, allowing traders to bet on the magnitude of price fluctuations rather than market direction.
• Initial trading suggests approximately a one-in-three likelihood that the volatility for bitcoin and ether will nearly double from current levels.

The decentralized betting platform Polymarket has unveiled contracts related to Volmex’s bitcoin BTC$88,983.17 and ether ETH$3,000.74 volatility indices, providing an opportunity for anyone to bet on market fluctuations this year.

The two contracts, “What will the Bitcoin Volatility Index reach in 2026?” and “What will the Ethereum Volatility Index reach in 2026?” were launched on Monday at 4:13 PM ET.

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These contracts pay “Yes” if any one-minute “candle” for Volmex’s 30-day implied volatility indices linked to bitcoin and ether rises to or exceeds the specified target by December 31, 23:59. If not, the contracts settle for “No.” A one-minute candle represents a price chart displaying an asset’s price action, including the open, high, low, and close over a mere 60 seconds. It resembles a candle’s shape with its “body” and “wicks.”

Thus, purchasing “Yes” shares indicates a bullish stance on volatility, implying you expect a more erratic market. Conversely, acquiring “No” shares suggests you foresee stability. In both scenarios, you are wagering on the extent of price fluctuations, rather than their direction.

Polymarket’s new contracts render volatility trading available to all, providing a straightforward, uncomplicated method to engage in a market typically dominated by institutions and large traders with significant capital. Traditionally, these larger players have utilized complex, multi-step option strategies or volatility futures to capitalize on anticipated shifts in volatility.

“Polymarket, the leading prediction market globally, launching contracts on Volmex’s BVIV and EVIV Indices is a significant achievement for Volmex and for cryptocurrency derivatives as a whole,” Cole Kennelly, founder and CEO of Volmex Labs, shared with CoinDesk in a Telegram discussion.

“This collaboration introduces institutional-grade BTC and ETH volatility benchmarks into the straightforward, intuitive prediction market format, simplifying the process for traders and investors to express their perspectives on crypto implied volatility,” Kennelly added.

Initial trading in these contracts indicated a 35% probability that bitcoin’s 30-day implied volatility index (BVIV) will surge to 80% from its current 40% level this year. The ether market exhibited a similar expectation for volatility to increase to 90% from the existing 50%.

It is important to note that the correlation between bitcoin’s implied volatility and its spot price has largely turned negative since the introduction of spot exchange-traded funds (ETFs) in the U.S. two years ago. This suggests that any increase in volatility is more likely to coincide with a decline in spot prices rather than a rise.