Volatility is the degree of variation of a trading price over time. In other words, volatility indicates the amount of uncertainty about the size of changes in an asset's value. The higher an asset’s spread of values means the higher volatility of it.
Volatility is a critical characteristic for investors as it shows both their risks and possible gains that comes with purchasing an asset. Cryptocurrency volatility is one of its most peculiar elements. As cryptocurrencies have no central authority and, correspondingly, no controlled emission mechanism, they are highly volatile. There are some other cryptocurrency features that make it volatile, such as having no intrinsic value, prevailing short-term investments and lack of institutional capital. Still, cryptocurrencies volatility is also what attracts a lot of investors and make it possible for the industry to develop so quickly after a lot of money was gathered due to the volatility of Bitcoin.
Nagdusa ang ginto sa isang napakalaking $2.5 trilyon na pagbagsak sa market cap na maihahambing sa buong pamilihan ng Bitcoin, na nagpapakita na ang mga “safe-haven” asset ay hindi ligtas mula sa volatility.
Umabot na sa pinakamataas na share nito sa reserba ng mga central bank ang ginto sa loob ng ilang dekada, na posibleng humubog sa landas ng Bitcoin bilang isang reserve asset sa hinaharap, ayon sa Deutsche Bank.
Isang dormant na Bitcoin Whale, naglipat ng $116 milyong crypto bago ang kritikal na desisyon ng Fed, habang naghahanda ang mga trader para sa volatility.