Decentralized betting platform Polymarket has included contracts linked to Volmex bitcoin and ether volatility indices, opening the door for anyone to bet on market swings this year.
The two contracts, “What will be the Bitcoin volatility index in 2026?” and “What will the Ethereum volatility index reach in 2026?” It went live on Monday at 4:13 pm ET.
These contracts pay “Yes” if any one-minute “candle” for Volmex 30-day implied volatility indices linked to bitcoin and ether meets or exceeds the pre-set target by December 31 at 11:59 p.m. Otherwise, the contracts resolve “No.” A one-minute candle is a price chart that shows the price action of an asset, open, high, low and close, in just 60 seconds. It imitates the shape of a candle with its “body” and its “wicks”.
So, if you buy stocks that say “Yes”, you are essentially bullish on volatility, which essentially means you expect a more turbulent market. On the other hand, buying “No” stocks means you anticipate stability. In any case, you are betting on the degree of price swings, not the direction.
Polymarket’s new contracts make volatility trading accessible to everyone, offering a simple and straightforward way to play a game historically dominated by institutions and large traders with ample capital. Traditionally, these big players have used complex multi-step options strategies or volatility futures to profit from expected changes in volatility.
“Polymarket, the world’s largest prediction market, launching contracts on Volmex’s BVIV and EVIV indices is a major milestone for Volmex and crypto derivatives in general,” Cole Kennelly, founder and CEO of Volmex Labs, told CoinDesk in a Telegram chat.
“This partnership brings institutional-grade BTC and ETH volatility benchmarks into a simple and intuitive prediction market format, making it easier for traders and investors to express opinions on the implied volatility of cryptocurrencies,” Kennelly added.
Early trading of these contracts showed a 35% chance of bitcoin’s 30-day implied volatility index (BVIV) doubling to 80% from its current level of 40% this year. The ether market showed an almost similar price for volatility, which increased to 90% from the current 50%.
Note that the correlation between bitcoin’s implied volatility and the spot price has become largely negative since the debut of spot exchange-traded funds (ETFs) in the US two years ago. This means that any increase in volatility is more likely to be accompanied by a drop in the spot price than a rally.
