[Digital Today reporter Jinju Hong (홍진주)] Bitcoin volatility has dropped to an unusually low level in its 17-year history, prompting forecasts of a sharp short-term price move.

On Aug. 19, Bitcoin Magazine reported that Fidelity Digital Assets said bitcoin volatility recently fell below 98.5 percent of all trading days.

The market is currently showing stagnant price action and trading. Fidelity Digital Assets also pointed out that spot trading volume is at its lowest level since 2019. Bitcoin has seen little meaningful change over the past 30 days and traded around $65,000 as of the time of writing. That is about 50 percent below its all-time high recorded in October 2025.

Fidelity Digital Assets defined this period as a "compression" phase. "Think of it like a coiled spring. The longer volatility remains compressed, the greater the chance of a meaningful move when that pattern breaks," the company said. The company voiced a similar view earlier this month, noting that "these compression periods generally do not last forever."

The market is also discussing the possibility of a bottom forming. Some analysts say the near lack of price movement over the past 30 days could mean a low has formed. VanEck said 30-day realized volatility on an annualised basis fell to 27.2 percent from 30.4 percent the previous month. That is less than half of bitcoin's long-term average of about 80 percent.

VanEck said that based on past cycle lengths, a bottom could form between September and November this year. Rather than whether there is a short-term rebound, how long the period of shrinking volatility lasts has emerged as the variable that could determine the next direction.

A broader investor base is cited as a reason for bitcoin's narrower price swings. Since the approval of spot bitcoin exchange-traded funds (ETFs) in 2024, bitcoin has become easier to access for new investor groups beyond existing cryptocurrency investors. Individual investors who felt burdened by cold storage have been able to buy bitcoin exposure through brokerage accounts, and institutional investors such as sovereign wealth funds and banks have also been able to participate in the market through ETFs.

Market expansion has also coincided with shrinking volatility. As bitcoin's market capitalisation has grown, sharp price swings have decreased compared with the past. K33 Research said in a report in December last year that 2025 was the least volatile year in bitcoin's history. The firm forecast that bitcoin could outperform both gold and equities in returns in 2026.

This downturn is also showing a different pattern from the past. Bitcoin is seen as going through its shallowest bear market in its 16-year history so far. Market attention is shifting to how much longer low volatility and weak trading will persist, and whether the direction will be upward or downward when the compression unwinds.