Decentralized prediction market platform Polymarket has launched new binary contracts that allow users to bet on the future volatility of Bitcoin (BTC) and Ethereum (ETH). The contracts, which went live on Monday, January 26, 2026, at 4:13 PM ET, are tied to Volmex Finance's 30-day implied volatility indices (BVIV for Bitcoin and EVIV for Ethereum).
The contracts pose the questions: "What will the Bitcoin Volatility Index hit in 2026?" and "What will the Ethereum Volatility Index hit in 2026?" They will settle on December 31, 2026, at 23:59. A contract pays out "Yes" if any one-minute price "candle" for the respective index spikes to or exceeds a preset target level by that deadline; otherwise, it settles "No." Buying "Yes" shares is a bet on increased market turbulence, while buying "No" shares is a bet on stability.
This launch represents a significant step in democratizing access to volatility trading, a domain traditionally dominated by institutions using complex options strategies or futures. Cole Kennelly, founder and CEO of Volmex Labs, called the partnership "a major milestone for Volmex and crypto derivatives broadly," noting it brings institutional-grade benchmarks into an intuitive prediction market format.
Early trading activity indicated market sentiment, pricing in approximately a 35% chance that Bitcoin's 30-day implied volatility index will double from 40% to 80% in 2026. The Ethereum contract showed nearly similar odds for its index to rise from 50% to 90%.
The article provides important context, noting that the correlation between Bitcoin's implied volatility and its spot price has turned largely negative since the debut of U.S. spot Bitcoin ETFs two years ago, meaning spikes in volatility are now more likely to coincide with price drops than rallies.
