LedgerX, the first US Commodity Futures Trading Commission (CFTC)-regulated crypto asset management platform, in an official press release statement on Monday, Jan. 14th 2019, announced the launch of its first Bitcoin price volatility index, the LedgerX Volatility Index (LXVX).
The company officials explaining how the price volatility index is formed said that the LXVX assesses the BTC volatility in a bid to com-up with a volatility tracking index in the cryptocurrency market space. The index can be thought of as the “bitcoin fear index,” similar to the VIX (the CBOE -Chicago Board Options Exchange, Volatility Index), commonly referred to as a “stock market fear index.”
The platform will draw the data for the LXVX volatility index from the various Bitcoin options that institutions are offering as trading options for the past year.
According to Juthica Chou, LedgerX’s COO, the new index can offer risk guidelines to traders and investors, which further will help them monitor the BTC volatility and risks. Chou also noted that VIX is an important stock market benchmark, and its usefulness is what encouraged the company to come up with an index for the Bitcoin markets. Adding further she cited BTC volatility in Dec. 2018 and compared it with Jan. 2019, LXVX is currently down by about 20 percent since the year began, down to 68, which is thrice the stock market volatility, but still a compelling figure, telling there is less volatility in the BTC market space than compared to in Dec.