How does skew delta affect the volatility of digital currencies?

1 answers

• kevin mendozaMar 29, 2025 · 4 months ago
  Skew delta has a direct impact on the volatility of digital currencies. Skew delta measures the market's perception of potential price movements, and when it is high, it indicates a higher demand for protective puts. This higher demand for protective puts suggests a bearish sentiment and can lead to increased selling pressure, resulting in higher volatility. Conversely, when skew delta is low, it indicates a higher demand for call options, suggesting a bullish sentiment. This bullish sentiment can lead to increased buying pressure and higher volatility. Therefore, understanding and monitoring skew delta is crucial for assessing the potential volatility of digital currencies and making informed trading decisions.
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