Learn hubBlogTake apart OPTIONS IV — how expensive options are, that is, how big a price move the market expects.
How expensive options are, that is, how big a price move the market expects.
Starting simple. Home insurance costs more where storms are frequent. Options are the same. One and the same call — strike 90,000, one month, BTC at 86,000 — costs different amounts depending on the market’s mood.
| Volatility, IV | A 90,000 call costs | Implied daily move |
|---|---|---|
| 15% — the market is asleep | 300 | 0.8%, about $700 |
| 25% | 1,000 | 1.3%, about $1,100 |
| 35% | 1,900 | 1.8%, about $1,600 |
| 50% — the market is stormy | 3,300 | 2.6%, about $2,250 |
The BTC price is the same in every row. Only the expected size of the move changes.
Comparing premiums in dollars is inconvenient: options have different strikes and expiries. So the premium is converted into one number — the size of the price move built into it. This is implied volatility, IV. It is measured in percent per year. The left column of the table is exactly that.
How to turn it into an understandable number. Divide by 19, the square root of 365. An IV of 34% per year is an expected move of about 1.8% per day. At a price of 86,000 — about 1,500 dollars per day. That is how the right column of the table is calculated.
Four lines on the chart:
BTC on 1 October 2026:
Both exchanges show almost the same thing. The longer the term, the higher the volatility.
See how expensive options are, that is, how big a price move the market expects.
For example.
| Field | Options | Default | What it changes |
|---|---|---|---|
| Exchange | Chart | Chart | Cannot be switched for options indicators: there are no other values in the list. The options exchange is chosen by the “Options exchange” field below. |
| Options exchange | Binance Deribit | Binance | Whose options to count. The chart’s exchange does not affect this: the indicator takes only the coin from the chart. - Want Binance options — Binance. - Want the main options exchange, with 19 times more BTC open interest — Deribit. |
In the Style four lines: IV 7D, IV 30D, IV 90D and the BVOL index. With the Deribit exchange the fourth line is DVOL.
Metric OPTIONS. Condition fields:
“Options exchange” — Binance or Deribit. “Options metric” for this indicator: ATM IV 7D %, ATM IV 30D %, ATM IV 90D % and BVOL Index. The “Exchange” and “Market type” fields are in the form, but the options asset is taken from the coin.
IV is the size of the move built into the option price, in percent per year. Divided by 19 it gives the daily move. Three lines for 7, 30 and 90 days plus the exchange index BVOL or DVOL. IV does not name a direction.
IV 30D rose from 25% to 35%, the BTC price did not change. What happened to the options?
Correct answer: They got more expensive: the market expects a bigger move