Topic: Why Bitcoin Is So Volatile - page 7. (Read 1298 times)

To start with it is the most utilized coin and fills in as the fundamental digital forms of money where as thought so different coins are connected in a roundabout way. Amid times bitcoin drops in esteem, I saw different coins are dropping likewise in nearly a similar example. It resembles a standard where everything depends. Presently in light of this huge utilization of bitcoin, changes in costs will dependably be relied upon every once in a while as a result of it. And furthermore in light of the fact that numerous contributed on it, numerous eventual doing exchanging every once in a while which makes it turn out to be exceptionally unpredictable in nature.

Price fluctuations in Bitcoin on the Bitcoin market are due to many factors. such as, being obstructed by bad news, bitcoin's perceived price fluctuations, small value options for large equity bitcoins, bitcoin investments in high inflation countries, tax treatment of Bitcoins are also volatile. Therefore, bitcoin can be evaporated.

The reason on why bitcoin's volatility changes frequently concerns about its lack of government intervention and a limited amount of supply in the market. Be reminded that there exists only a limited 21 million bitcoins on the market. Like what you said, the law of demand and supply also contributes on its high volatility in the market. Not to mention, the demand of bitcoin due to the hype caused by social media have caused an uproar on its price remarkably. But I believe that this volatility can be explained due to the lack of any regulation caused.

Not only Btc but also the other crypto and shares are volatile.Because it's structure is like that.None in the market corporate world can be made fixed.These are influenced by different variables,so it's price is always variable.Sometimes rising, sometimes falling the price.Demand and supply are very important in this case but in additional to the international market, economic recession, consumer purchasing power, intereste and speculative impacts work much more.

First it is the most used coin and serves as the main cryptocurrencies where as thought so other coins are related indirectly. During times bitcoin drops in value, I saw other coins are dropping also in almost the same pattern. It's like a baseline where everything depends. Now because of this massive usage of bitcoin, changes in prices will always be expected from time to time because of it. And also because many invested on it, many would be doing trading from time to time which causes it to become very volatile in nature.

This article give us another knowledge for what we need to know more about bitcoin. But there are a lot of factors why bitcoin is very volatile:

1. Little option value to large holders of the currency = Bitcoin volatility is also to an extent driven by holders of large proportions of the total outstanding float of the currency.  For Bitcoin investors with current holdings above around $10M, it is not clear how they would liquidate a position that large into a fiat position without severely moving the market.  Since Bitcoin’s volume resembles a small cap stock, the currency has not hit the mass market adoption rates that would be necessary to provide option value to large holders of the currency.

2.News about security breaches make investors react = Bitcoin can also become volatile when the Bitcoin community exposes security vulnerabilities in an effort to produce massive open source responses in the form of security fixes.

3.Bitcoin’s high profile losses at are another driver of volatility =
It is worth noting that these losses and the ensuing news about the losses had a double effect on volatility.  They reduced the overall float of Bitcoin by approximately, producing a potential lift on the value of the remaining Bitcoin due to increased scarcity.

4.Bitcoin and foreign direct investment in countries with high inflation =
Bitcoin’s use case as a currency for the developing countries that are currently experiencing high inflation is valuable when considering the volatility of Bitcoin in these economies versus the volatility of Bitcoin in US$.  Bitcoin is much more volatile versus the USD than the high inflation Argentine peso versus the US$.

There are a lot of factors why the price of bitcoin is so volatile.Here are just a few of the many factors behind Bitcoin's volatility:

1.Rate of adoption is hampered by bad press= News events that scare Bitcoin users include geopolitical events and statements by governments that Bitcoin is likely to be regulated.  Bitcoin's early adopters included several mal actors, producing headline news stories that produced fear in investors.

2.Bitcoin's perceived value fluctuates= One reason why Bitcoin may fluctuate against fiat currencies is the perceived store of value versus the fiat currency.  Bitcoin has properties that make it similar to gold.  It is governed by a design decision by the developers of the core technology to limit its production to a fixed amount, 21 million BTC.  Since that differs markedly from fiat currency, which is managed by governments who want to maintain low inflation, high employment, and satisfactory growth through investment in capital resources, as economies built with fiat currencies show signs of strength or weakness, investors may allocate more or less of their assets into Bitcoin.

3.Too much variance in perceptions of Bitcoin's store of value and method of value = Bitcoin volatility is also driven in large part by varying perceptions of the intrinsic value of the cryptocurrency as a store of value and method of value transfer.  A store of value is the function by which an asset can be useful in the future with some predictability.  A store of value can be saved and exchanged for some good or service in the future.  A method of value transfer is any object or concept used to transmit property in the form of assets from one party to another.  Bitcoin’s volatility at the present makes it a somewhat unclear store of value, but it promises nearly frictionless value transfer.  Since these two drivers of the current spot price of Bitcoin vary against the dollar and other fiat currencies, we see that Bitcoin's value can swing based on news events much as we observe with fiat currencies.

This is just the few factors why bitcoin price will not stable and it will keep on changing very time.

What really makes the price of bitcoin so volatile is how to demand changes so abruptly, the supply of bitcoin can change but is more or less fixed there is a very limited amount of coins and not every single holder of bitcoin is going to want to sell at the same time, what changes in a very dramatic way is that sometimes there is a huge demand as we saw in December and sometimes the demand is very low like what we're seeing right now.

Because this market is still based on panic, lack of real information, misinformation from mass media etc., lack of knowledge, and is not backed by enough solid businesses. Mostly speculative.

The sad truth is, Bitcoin is volatile because it doesn't have real use in the economy as a currency with which people buy things and pay for services. Uneven demand that you talk about is a straightforward consequence of that. If Bitcoin was used as a means of payment, the demand for it would soon stabilize relative to the amount of goods and the volume of services offered for it. But because the vast majority of demand comes from plain speculation, it is prone to wildest fluctuations leading to extreme volatility.

Do issues affect this volatility? But if seen from some previous issues such as China starts to ban bitcoin the price is also going down but a few days later there is a new issue again making the price of bitcoin back up. I do not know what actually made it happen but that is my opinion. Or this may be due to nature of cryptocurrency.

You will get to know more about crypto currencies once you will be completely there in this world and at time, when you will be having some sharp knowledge regarding this concept. However, the only reason behind this much volatile nature of bitcoin is none other than that of variation in the demand of the bitcoin in the international market as it keeps on increasing and decreasing most of the time.

The best bet for bitcoin is that as it becomes more popular and more people buy it, these types of changes in value will go down for two main reasons.First,individual owners have less power over the price of bitcoin, and, second,it creates stability since more people have a stake in the cryptocurrency.

The issue of volatility of Bitcoin is no news and no one reason explains that nature. One of the contributing factors for the volatility is the fact that Bitcoin is decentralized and not regulated by any authoritative body. In the absence of regulation, bad actors can act upon the price and manipulate it as they wish.

Bitcoin exchange rate fluctuations in the Bitcoin stock market are driven by many factors. Volatility is measured in traditional markets by the Volatility Index, also known as the CBOE Volatility Index (VIX). Bitcoin volatility does not yet have a generally accepted index because cardiac crypto as asset class is still in its nascent stage, but we know that Bitcoin is capable of experiencing volatility in the form of a 10x price change versus the US dollar, relatively short period. time.

its purely selfishness,author only focus on bitcoins volatility depends on what he wants reason must,but for many of us,bitcoins become volatile because of its capacity to stand in all aspects either trouble or in favor.maybe this same reason why many people nowadays turning to this community that stocks exchange

There are many reason for volatility of Bitcoin and some other cryptocurrencies.
Mainly because the total supply is not enough. If any institute or individual is powerful enough, then they can influence the market price
relatively easily.( Just imagine if there are only 100 apples in the whole market, and someone is rich enough to buy 20 of 100, then he or she can influence  the market price by buying high and selling low)
The another reason is cyrptocurrencies  don't like the traditional fiat currencies or securities.
There are no back-up and the market price is fully based on transaction.

Because there are still fluctuations in the minds of people about accepting or rejecting btc ecosystem so the ecosystem is still in a whirl

I conduct researched about volatile of bitcoin because i also dont know the reason.And they said that Little option value to large holders of the currency.Bitcoin volatility is also to an extent driven by holders of large proportions of the total outstanding float of the currency.  For Bitcoin investors with current holdings above around $10M, it is not clear how they would liquidate a position that large into a fiat position without severely moving the market.  Since Bitcoin’s volume resembles a small cap stock, the currency has not hit the mass market adoption rates that would be necessary to provide option value to large holders of the currency.  

Just a little wake-up call for the people who are still planning to sell at this point. The past is gone, but every severe dip in crypto has proven itself to be converted in a stronger eventual upswing. This crash is actually one of biggest, but please think about it for a moment.. all these brilliant ideas's that are still idea's. This is just the beginning. That means, honestly, the market was overhyped and overvalued in December because there were/are no working products yet. Imagine when the winners in the field are going to launch their platforms (e.g. Neo). Blockchain will definitely be integrated into our daily lives people. So if you believe in this, stay in there, or take the opportunity to buy or dollar-cost average the quality coins that were way too expensive in Dec/Jan/Feb. Remember that buying the dips only really seems to work when the market is oversold. It's not a sure thing since some stock prices, in general, are due to negative changes in the underlying company’s fundamentals.