According to research and brokerage firm K33, Bitcoin’s 28-day realized volatility is nearing its lowest mark of the year. Market participants are showing minimal interest in taking on extra risk ahead of the upcoming U.S. midterm elections and the Federal Reserve’s next interest rate announcement.
In its recent market report, K33 noted that bitcoin’s 28-day volatility dropped to 1.2% while the cryptocurrency hovered between $80,000 and $84,000 over the past week. Mean daily spot trading volume registered at $2.5 billion, representing a 1% decline compared to the previous week. Bitcoin has stayed confined to a tight band since September 21, with K33 drawing parallels between this subdued activity and the market rebound seen in 2023. Vetle Lunde, Head of Research at K33, stated that periods of compression are typically followed by expansions, and they anticipate BTC volatility to rise shortly.
Even with diminished price turbulence, BlackRock’s IBIT fund drew inflows matching 8,128 BTC on October 19, marking its strongest single-day bitcoin influx since April 2025. K33 data indicates that across all U.S. spot bitcoin exchange-traded funds, net inflows reached 6,436 BTC on that date, as competing funds experienced an aggregate net outflow of 1,692 BTC.
Bitcoin and Nasdaq correlation picks up
Concurrently, K33 observed that bitcoin Bitcoin (BTC) has regained a strong correlation with the Nasdaq following a weakened connection through August and September, with the two assets showing nearly identical returns over the past fortnight. Bitcoin managed the equity downturn last week relatively well, sliding around 2% even as the Nasdaq suffered its worst weekly performance since early April 2025.
The stock market slide came in the wake of a hotter-than-anticipated September U.S. inflation report, alongside a semiconductor sell-off triggered by news regarding a Chinese memory chip breakthrough. Nevertheless, K33 warned that bitcoin’s relative strength during the week did not translate to a new decoupling from equities.
LMAX Group market strategist Joel Kruger told The Block that digital assets remain inside a consolidation phase, with both bitcoin and ether seeking direction following their robust recovery across August and September. Kruger pointed out that the recent bounce in Treasury yields and the greenback highlights that financial market adjustments are still uneven. He added that they view the recent pullbacks as a temporary pause within that recovery, expecting dips to find support prior to a potential continuation of gains toward the end of the year.
As reported on The Block’s prices page, Bitcoin (BTC) trades near $83,350 on Wednesday. K33 stated that markets are currently pricing in an 80% probability that rates will remain unchanged at the upcoming Federal Reserve meeting on October 28. Meanwhile, the U.S. midterm elections are scheduled for November 3.
Originally published at https://www.theblock.co/news/markets/2026-10-21-bitcoin-volatility-nears-2026-lows-as-traders-brace-for-fed-decision-and-us-midterms-421524.
