Amberdata's director of derivatives, Greg Magadini, believes that the upcoming Bitcoin reward halving will not cause a significant increase in volatility. With the date set for April 20th, the halving will reduce the issuance of bitcoin per block from 6.25 BTC to 3.125 BTC.

While implied volatility (IV) on Bitcoin has risen in anticipation of the event, indicating potential price turbulence, Magadini suggests that paying a volatility premium for a highly predictable outcome may not be worth it. Typically, traders place bullish bets on volatility leading up to uncertain events, seeking to profit from price swings. However, the impact of previous halvings on Bitcoin's price and miners has been well-documented, with historical data showing significant rallies in the 12-18 months following the event.

Magadini points out that previous major crypto events, such as Ethereum's Dencun and Shanghai upgrades, as well as spot Bitcoin listings, had little market impact. Traders who expected a surge in price volatility during these events were left disappointed.

Despite the expectation of increased volatility, Bitcoin's 30-day implied volatility has risen to an annualized 75% from 68% in just a week, according to Amberdata. Additionally, the 30-day volatility risk premium (VRP), which measures the gap between implied and realized volatilities, has exceeded 10% for the first time since early March. This rise in VRP is often seen ahead of and after extraordinary market events.

Magadini suggests that options implied volatility is overpricing the upcoming halving, emphasizing the uptick in VRP. Amidst this analysis, Bitcoin is currently trading at $71,800, enjoying a 3.5% gain on the day. The cryptocurrency has shown an increase of over 11% since reaching lows of around $64,500 on April 2.

As the market prepares for the halving, it remains to be seen whether the event will produce the anticipated surge in price volatility. Regardless, traders and investors continue to closely monitor Bitcoin as the halving approaches, analyzing its potential impact on the cryptocurrency's long-term trajectory.