Bitcoin Forum

I just try to find the major reasons for the very high volatility of bitcoins price we all encountered over the last years.

1) Exponential Growth ( in trust and usage)

It's clear this is a very strong reason to cause price volatility, since we have double and double of requesters that all needs to get coins from a scarce bitcoin supply.
So we see price squeezes all over the time (more up than down). Further we have no or lost experience with such exponential growth process esp in money (last adoption was gold some 1000 years before)


2) Evaluation Base CCY ?
I have the strong suspicion that bitcoins volatility is positive correlated to the volatility of the lowest trusted fiat currencies' volatility in the world.
Sadly I cannot proof this by averaging the historical volatilities of a 'poor's currency basket' of (Zimbabwe$, Venezuela$, Egypt pound, Jemen slotty, Syria Dinar,..xyz...) but I estimate, that we have same volatility there as in bitcoin. And all people living in those countries should be way better off with bitcoin and it's vola!
We just see and measure BTC/USD - volatility is high, but we forget where it's based on - on the poor ccys all together - but they are dominant here.

3) Heterogeneous / Fragmented Markets
We now have some 100 different exchanges and local places where you can exchange you bitcoin against any other fiat or crypto. There is no condensed order book / matching for a trade and limited arbitrage due to capital protection of some states.
I'd guess we'd see a fraction of the actual volatility, if we would have a (ideal) single world exchange, where all must trade BTC/USD (USD is just a default example for a world fiat and rest crypto ccy) .


Any other reasons you could see?

Bitcoin supply and demand will rate the volatility of the bitcoin value. As adoption rate increases price will move forward and if there is any market fall happens then bitcoin related business or project that time will see the dump in price.

I think one of the reasons is that Bitcoin is not tied to any real activity, for example, the currency exchange rate depends on the trade in goods and many other factors. Bitcoin depends much on the mood of the crowd.

I think the only reason for that is because Bitcoin does not have a real economy yet. It is just used for trading purpose, unline other traditional currencies which are used to buy and sell stuff

For all bigger currencies there is a huge 'efficient' FX market / huge volume trading in place - that keeps the vola in a narrow range.

And yes - economy is also a fact there and mostly corridored to +2% p.a. - vola is low due to that as well...

I cannot really comment on 1, or even 2... but I do know a few of those currencies, and not sure they can even out to Bitcoin's 10,000% or more growth from 2009 to 2017. Very loose connection.

But on 3, a single world exchange isn't possible... even today for forex you don't have ONE exchange but many. Each country also mostly trades on its own basket.

You have to remember that Bitcoin are not widely accepted yet. You have a bunch of whales manipulating the price and you have a bunch of small

events causing the spikes and the dumps. Some of the biggest events was hacks like MtGox and scandals like Silkroad. In between all of that, you

have slow mainstream adoption of the technology on a global scale.  ;D

Since bitcoin is a global market, it is exposed to all kind of frictions, different countries having different reasons to buy or dump it and so on. The marketcap is too small to not fluctuate a lot, which is good because it shows there's a ton of upwards potential. Once the marketcap is worth 7+ trillion like gold, the price will be way less volatile.

Bitcoin for sure has been one of the most volatile currency (if we have to compared it to the fiat money) and had it been a national currency of a certain country then it might pose some big problems though of course there would be many holders who can be ecstatic seeing their money jumping in value in a very short time.

One of the many factors for Bitcoin (and this can also be true with other commodities traded in an open market) is the ever increasing demand and the limited supply. Had it been possible to just "print" or create Bitcoin by command then we can easily lessen the volatility as what many central banks are doing to prop their own sagging economies.

Now, may be the next question is this: Is volatility helping or hurting Bitcoin?

Bitcoin is a decentralized currency which has no authority to control its price.Its value is driven by the support from the community.Its price increases or decreases directly in proportion to increase or decrease in demand for bitcoin.There is no variation in supply since it has been already set as 21 million coins for supply.Greater the demand,more increase in price and smaller the demand,lower the price.In this way,we could say that bitcoin expresses its true value.

This is the reason for the volatility. Since bitcoins are not backed up by anything, unlike in fiat currency where it is backed by gold and/or the government that issued the currency, this results to bitcoins being valued by the users themselves. That is why we see a whole lot of volatility here. Maybe in the future when there are more people using it then we could see some stability.

By crowd I think it's more appropriate to refer to these people as the whales. The big traders are the ones causing so much votality. Ordinary traders are the one ones who are going with the flow. Bitcoin is easily being manipulated with huge investors. If these whales feels like they want big profit they will pump and other people will do the same and then eventually leave once they received profit and then the price will go through correction.

I think BTC has this volatility because of the whale and their pumps and dumps. It is a main source of income for those who still cash out in FIAT... imagine what will happen when people won't cash out BTC so quick... a greater value for sure!

I cannot agree with your reasons stated for I think none of them is the reason of Bitcoin being volatile in nature.

Number 1 is not a reason why Bitcoin is volatile, it is a result. Bitcoin is very volatile that is why we can see an exponential growth in Bitcoin's price.

I do not know why relating and comparing Bitcoin to an existing (or not) currency out there would justify and answer why Bitcoin is volatile.

Number 3 does not reflect volatility, we can see varying prices from different exchanges because of their own policy. These exchanges are businesses wherein the owner/s dictate/s how much is the price of Bitcoin in buying and selling with respect to the actual value of Bitcoin. So there is no volatility in here.

The main reasons why Bitcoin is volatile are:

1. Decentralized - Being decentralized, no entity dictates or controls the price of Bitcoin which then leaves to the market to decide for Bitcoin's price. This leads to number 2.

2. Demand and Supply - Since the market dictates the price of Bitcoin, the only variable that is measured in here is the volume of demand with respect to the available supply in the market. The demand and supply of Bitcoin in the market changes every time. This is the main reason why Bitcoin is very volatile in nature.

Whale(s) are really going to be trying to takeover this entire currency to be using it as a HUGE source of income, we can see already how profitable they've been with it and how much they're really pulling out of Bitcoin. It's pretty insane to see the amount of trading that's occurring in Bitcoin and other Cryptos right now which are REALLY riding up the price.

The major reasons that I can see are going to have to be the people joining into BTC right now and thinking that they're going to be making a quick buck off of it, it's just like the roaring 20's when everyone in America was getting into different stocks because everything was going up and up. People were using leverage and loans and so on to amplify wins, little did they know the bubble had to pop at some point and everyone was left in the dust. I think the same sort of thing is going to happen with bitcoin, the only question we really have is WHEN?

I think the main reason is because the price is undervalued. If bitcoin were trading at $100k a coin, then a swing of $10k in either direction (which would be huge by today's standards) would not be considered so huge.

Bitcoin is traded very freely - you have sellers and buyes finding a price. The evaluation IS market to market - fair and correct.

I guess you speak about the trend - this is clear a massive up-trend and  we see many days with 10% up and a few 20% down - doesn't matter if we are in different price regimes:
2011: 2 -30   
2013: 100-1200
2017: 800 -3000

2022:10k-100k ?

 ;D

Volatility might be driven by the decentralized nature of the currency and demand among users. The rate is very responsive to all the changes within the crypto environment. As it is a relatively new concept for finances, no one knows, how to control it or somehow restrain.

First of all, I don't see these three reasons as main causes for volatility, at least, not to any meaningful degree

Further, as to me, the primary cause of Bitcoin volatility is that it remains purely a financial asset, i.e. it is either traded (directly, on exchanges) or indirectly (by merchants, when they sell the bitcoins they receive as payment for fiat), or just stashed away. In other words, if there were a closed loop Bitcoin economy, and the majority of bitcoins were used for payment and not for trading, that would bring volatility down. This is basically the same with penny stocks. They are mostly useless as long term investments and as an instrument of controlling a company (i.e. it makes no sense to buy them if you are looking for voting rights and more control over the business itself)

The demand s one of the major reason of price volatility and we will not have that volatility if the demand is not increasing or decreasing. Bitcoin is a decentralized coin and it means that bitcoin is only depending to the peoples demand and if that demand will change then it will reflect for volatility of the price of bitcoin. That is the only thing that i can see for the volatility of bitcoin.

There are no fiat currencies today which are backed up any hard asset like gold or silver

It could be said that the US dollar is sort of backed up by oil (see petrodollar) but this itself is just an effect of the US grip over the world, that they can force foreign governments to buy oil for American dollars. In this way, it is rather the power of the state that is actually backing up the dollar, and it is true in respect to any fiat currency out there. But since there are quite a few currencies that had just been volatile at first and then turned to complete trash, this cannot be an explanation for Bitcoin volatility (i.e. the lack of state support)

Price fluctuation of btc is largely affected by btc demand in the market. This changes over time, thus creating a rise in price, is also one of the opportunities to make a profit..Market stability is maintained only when btc supply and demand are close together, so btc prices will stabilize.

1. Supply and demand. Simple equation, bitcoin is limited in supply + more demand = price fluctuations. The same situation happens when someone invested heavily in bitcoin either keeps his bitcoin for a long period of time or dumps it. Compared to all other major currencies, the market cap of bitcoin is still small, 44 billion so even a small percentage of pumping or dumping can cause a marginal fluctuation in price. This would decrease as more users adopt and market cap increases.

2.  Store of value vs a medium of exchange. This is similar to supply and demand. Holding on to bitcoin vs using bitcoin as a medium of exchange thus circulating it.

3. Media. Yeah to some extent media does influence the price of bitcoin. A positive news brings with it an increase in price and even random criticism of bitcoin by billionaires/business magnates tend to affect the price a bit. Bitcoin is a global currency and any significant financial, economical, or political global event would affect its price.

My opinion is that the dollar is so popular not because oil is traded in dollars, because before the Americans invested a lot of money to spread the dollar around the world. They were handing out loans even free of charge. Now almost every person on earth is in the hands of dollars and not beneficial to anyone his fall. Bitcoin has no centralized management and therefore the change in demand for it so affects its stability.

For me the volatility happened because bitcoin is slipping, the last time when bitcoin transaction fee increase and the slow confirmation, a lot of people chose another alt coin to used, and alt coin is in a good stage this year so a lot of investor is investing in alt coin, but they only used it for trading, so its pumping and dumping activity and it cause volatility

As volatility is just around the corner. These are the factors just to sum it up.

1. Supply and demand
2. Speculations
3. Changes in the mmarket
4. Investors

Yes, i agree with you, altcoins play a big part for bitcoin volatility, mostly this year, because most altcoins price are increased. So people begin to invest in these altcoins, in result bitcoin have a big volatiltiy of price. I think this is the major reason.

It pisses me off that we're in this kind of place now too, since everything is skyrocketing in value since we lost any sort of peg to a hard asset and now we have to rely entirely on the whims of the government to not be printing money constantly. Back in the '50s a half would be half the yearly income, now it's over 4 times a yearly income. And jobs and wages keep getting depressed. Not a good economic situation and it makes sense as to why people are dropping out of society because of it.

I wish we could go back to having banknotes that were actually worth something, instead of the worthless paper or plastic which is now giving way to degeneracy.

I wonder how would be the volatility if we could exclude the speculation factor from the scene.

Bitcoin market is not different than any other market in the world.
It means that people decide about money based on emotions, not rational reasons.
So, if bitcoin start to rise, everybody are happy and buying.
When something happen and bitcoin start to go down, everybody sell in panic, and the value of bitcoins is even more collapsing.
There are no rational explanation for it, believe me.
You have to study human emotions in order to understand it :)

The speculation factor is one major reason for adoption. Think about all the small forex traders trading with nearly no capital but with leverage. All the gamblers and gamers. They have no big new playground for pennies.

Wake up now, no fiat currency out there is still backed by gold, it used to be back in the days, but not anymore. As a matter of fact, government issued currencies are backed by nothingness, that is the reason, they print enormous quantities at will and a chief reason inflation is already double digits in most countries.
 
Bitcoin supply for now is capped at 21 million coins and that cannot be faked, transactions are transparent and a holder has the final say what becomes of their money unlike the manipulations common with fiat currencies. These and more exquisite attributes keeps driving the demand for Bitcoin high and the resultant market dynamics creates the volatility we're seeing. However by the time Bitcoin is embraced by a lot more people, it is likely to become relatively stable.

"You can get much further with a kind word and a gun than with a kind word alone"

Apart from that, I can't really fathom what do you mean by Americans investing "a lot of money to spread the dollar around the world". What money do you refer to here? Isn't dollars that money exactly? In a certain sense, they really poured a lot of money into the advancement of their economy, but that's what many countries do anyway. As to me, most of dollar popularity was due to the fact the US was not particularly affected by the two devastating wars that had left half of the world (and the best half of it) in ruins

I'd say one of the biggest reasons at the moment is going to have to be all of the tons of people joining in on Bitcoin thinking it's going to be 'easy money' for whoever gets in on it fast, so what it's doing right now is making a HUGE DEMAND for a currency that is really IMO being used for mostly trade at the moment. This is one of the core reasons, but some of the other reasons are going to be the amount of money that's being put into cryptos in general (not just Bitcoin) and these people need a currency to exchange, which is always bound to be bitcoin.

Whales are the ones that are making this volatility a thing, or an issue, these and the day traders are the people that are bound to make a SHIT TON of money from the volatity being higher as they have a higher margin to be able to catch Bitcoin on and make a buck.

At its heart its solely supply and demand that is the cause of volatility. Aside from large cause and effect cases trying to be logical and pin point clear event can be challenging as markets aren't a rational beast.

These whales are only whales yet since the real whales like Black Rock and co are not or very tame in the game and the daily trading volume is that of a poor country's currency.

Yes, so I want to correct this that price fluctuations are not only determined by the demand but also the amount of available bitcoins (supply). These are basically the factors of Bitcoin's volatility.

LOL, the term "fiat currency" specifically means money created by government decree, with no explicit backing other than the rule of law and violence by that government. For example, gold and silver backing of USD ended 100 years ago.

I'm surprised that nobody has pointed out that Bitcoin price can easily be manipulated by EXCHANGES. In fact, it has been proven that Mt. Gox increased the BTC/fiat exchange rate by about 10x, before the whole thing came crashing down. Many may not realize that exchange transactions are not recorded on the blockchain, only with withdrawals and deposits go to the bank and blockchain records. An exchange can sell you "bitcoin" or "dollars" all day even if there is nothing to back it. An exchange can "buy bitcoin" from itself all day long as well. Naturally this causes increases in the bitcoin price. Of course exchanges and traders can arbitrage each other, but they can also work together and collude to drive the price upward (or downward). Finally, exchanges can "front-run" any trade - here they simply buy or sell milliseconds before you do, taking a small fraction from each transaction (on top of any fees they charge). It is known in the fiat financial world that Goldman Sachs and other market-makers front-run every day 24x7, using high frequency trading datacenters.

None of this price-changing activity by exchanges would be illegal - the Bitcoin space is still largely unregulated. Mark Karpeles went to jail for one year for "fraud", but that was simply for misrepresentation and lying. Given this environment, I don't see why and exchange wouldn't engage in at least some price manipulation... likely they would be a bit smarter than Karpeles was...

I agree with you, the volatility of the bitcoin price is always depending in the demand and supply and you can't split those things because they are very related to each other, if the demand goes up then the supply goes down and if the supply goes up then it means that the demand is going down so it is very related to each other and as long as we are maintaining the demand that we are getting right now then the price will keep going up.

They cant really be separated because things normally goes on this way and its part of economic thing not only existing on bitcoin but all things that surrounds us we can eventually saw it on everyday living and yes supply and demand does really matter. It just a normal thing for the price to rise up when theres demand and the supply is limited then expect value would really change up.

Methinks the volatility is honestly just a bunch of bullshit ;) this is like the most heavily manipulated market you can participate in; no regulations and it doesn't take a lot of fiat to manipulate some of the exchange. Just deep pockets or coordinated selling/buying. The price moves so much because the investors are so inexperienced, and professional traders are making a killing off of inexperienced traders that are reactionary and undisciplined. It alsooves because whales want it to move. Mark my words, the price of bitcoin is being depressed until corporate American can buy in. It will quickly become fully regulated, and the price will soar. Lobbies will see to that. Otherwise, it will be an alt, mostly ETH.

There is no agreed upon way to value a bitcoin. Hence, a price borne completely on speculation won't be very stable.

Oh, it is you again with your amateurish crap

I'm curious if you really understand what front-running actually means (there can be a few different ways to do it). There is no sense to front-run any trade (as you claim), and I don't see what you mean by "taking a small fraction from each transaction" (beyond the regular trade fee). To tell the truth, I don't see anyone taking anything extra from my trades. Cryptsy had been caught by directly and openly changing the order queue (if that is your point), but this is not what front-running client orders typically means (and that might in fact have been a bug in their trading engine). And just in case, dollar backing by gold ended less than 50 years ago (see the Bretton Woods monetary system)

At the moment the infrastructure and landscape that is shaping Bitcoin is in flux and ever changing. Once more and more mainstream buyers and holders of Bitcoin enter the market as opposed to hit and run speculators, we should see a more stable price evolve. There is also the fact that Bitcoin is limited in supply so if demand skyrockets, so will the price.

Ohh, you again, dumbazz... should've kept you on ignore, but I took the bait...

Front-running is a very simple concept. Google it if you can't grasp it. If front-running is done by a bitcoin exchange, it's easier than what Goldman and other market-makers currently do, and near impossible to detect. Cryptsy got caught, there is an academic paper about the Gox-rigging (post mortem of leaked trade logs), and Bitfinex is currently getting arbitraged for doing it. Poloniex is more sneaky and cuts thin slices of cheese off the margin traders, and occasionally flips a "circuit breaker". But nobody is "taking anything extra from your trades", LOL, how would you know?

Federal Reserve bank was created in 1913 - effectively the end of USA gold standard. Private ownership of gold was made illegal in the 1930s and some gold was even confiscated shortly thereafter. Gold certificates were unredeemable from this point onward. Only foreign governments were allowed to redeem USD for gold. Nixon "closed the gold window" in 1971, but reserves were very fractional by that point anyway.

Any other questions?

I'm still waiting for your explanation how front-running actually works. I'm not interested in hearing empty verbiage that you pour on me. I want to hear details explaining where and how front-running allows exchanges to earn profits. After all, it was your claim, not mine, so the burden of explaining is obviously on you, not on me. Regarding my trades, if I place an order and it gets executed, I receive exactly the amount I'm buying minus trade fees. No one is taking any fraction from my trades apart from what I know beforehand (i.e. fees). For your information, the gold standard in the US ended in 1933 when the Fed had withdrawn US notes ("real dollars", which had nothing to do with the Fed) from circulation. The latter had been fully redeemable for gold until they were declared obsolete

You may want to go and learn the history of the American dollar

The price of bitcoin has been on the rise in the past few months. Sometimes we experience drops and sometimes we have highs in the price. Personally, I feel there are a few reasons that can be attributed to the volatility of the bitcoin price:
1. Over 700 crypto-currencies exist. Bitcoin is used to buy other crypto-currencies, which increases demand for Bitcoin.

2. Bitcoin is up 166% to $2480 on June 25 from $935 on March 24.

3. Japan approves Bitcoin as a legal form of payment April

4. Blockchain technology gives credibility to digital currencies.

I try an explanation:
The major reason of the volatility is because lots of people/investors own lots of bitcoins. Everytime these guys (whales) buy or sell, it has an impact on the market. This impact is amplified/followed almost systematically by a "shockwave" (the small investors/traders are following the trend).
This is just my idea..

Bitcoin is a decentralized currency and its price either increases or decreases in proportion to increase or decrease in demand for bitcoins.There is no authority or governing body to control bitcoin price.Bitcoin price is driven by the support of bitcoin community.So its quite natural taht bitcoin price is highly volatile and it would remain volatile till last.Even volatility is the main feature of bitcoin due to which traders gain profits from the difference in price.

The gold price dropped heavily this morning. Reason was a fat finger issue / human stupidity issue: A guy just mixed ounces and lots and even gold markets are very thin / low liquid.

Same could happen in bitcoin's thin markets as well.

More reasons to be unveiled....  ::)

All markets, including cryptocurrencies, have volatility. All markets depend on faith. There isn't a company or resource behind bitcoin so there is no wonder there is volatility.
There are ways to reduce volatility: for example, invest in more cryptos or even invest 60% in stocks and 40% in cryptos.
It's extremely weird for any rational person to be surprised about volatility.

I can feel that we are now entering a stage where people are gradually questioning anything related to Bitcoin and this can be one of the ultimate reasons behind the continuing drop of Bitcoin and the whole cryptocurrency market in general. People are getting back to reality...slowly moving away from the speculative and very positive views expressed since the beginning of this year.

As to volatility, it can be spurred by the fact that Bitcoin is still that really so big and can still be manipulated by groups who have the financial clouts to do so. Plus recently there were entrance of new Bitcoin holders and they can easily be swayed to sell for just very simple reasons.

Volatility have been serving many traders well, that is a fact that should also be taken into consideration. Although it can help Bitcoin if volatility rate can be lessen to a certain degree which can make it more popular.

The combination of whales (long ETH for 30Mio) , thumb traders (sell all at once), pre-mature exchange (GDAX) and very thin order books

-> leads to monster volatility!


http://video.cnbc.com/gallery/?video=3000631102

You meant to say not so big, right?

This is certainly so, but this is surely not all. Before Bitcoin got to well over 4 digits, volatility wasn't that insane, though Bitcoin obviously couldn't be bigger at that time than it is now. The real systemic cause of high volatility is the price itself as well as Bitcoin fixed supply. If we assume that monetary supply remains more or less the same, at least, short to medium term (which is a good assumption), the higher price necessarily means that the market supply is diminishing, but that leads to less liquidity (supply side, before all) at higher prices which makes markets a lot more prone to greater volatility

So the people are not patronising the currency as they used to do,or are they questioning its valuability now, from what's happening it's going to be hard for it to pass the $3000 threshold.

Yes but not only the demand, the supply also plays an important role in the fluctuation of Bitcoin's price. Bitcoin's price is dictated by the number of demand with respect to the available supply in the market so both demand and supply have their roles. And as to what you've mentioned (I will add the supply), bothe demand and supply changes over time, thus making the price vary depending on the demand-supply relations.

The stabilization of Bitcoin's price is not dependent on the closeness of BTC's demand and supply. Even they are far apart, stabilization may also occur considering that their proportions grows simultaneously.

Volatility is a result of to much energy passing through a system. Read Chaos by James Gleick to see how deterministic behavior switches to non-deterministic behavior (chaotic). For Bitcoin, money is the energy entering the system. This results in runaway valuation which then collapses to a new high.

This will continue till cryptocurrency reaches it's final valuation of the economy. At this point, we will switched to a more steady and predictable growth. I am guessing this final growth will be around 12% per year in value. There may be no fiat currency left to measure it though, you will just see the price of goods slowly dropping in terms of BTC instead.

Although I don't owe you any explanations, I can't help but laugh a bit. If you place an order and it gets executed at the price you chose, what else would happen, duh? It's not like the exchange will tell you "We bumped the price a little" and it's on your statement, LOL. The point is that you bought a fraction higher than spot and sold a fraction lower than spot.  Frontrunning is when the exchange places a sell/buy orders in front of buy/sell orders to lift/drop the price a bit and profit off both sides of a trade.  I don't know how to explain it to you any better... or are you playing dumb?

Finally, when you close an order on an exchange, did you really think you're buying/selling coin? It's just a float until you withdraw fiat or coin. And therein lies the problem...

The chief reason for bitcoin's volatility, in my opinion, is the lack of investor experience, and lack of capitalization (weak/thin books). Half of the users that trade bitcoin are children, or at least don't speak English so good, as evidenced by the trollboxes of the various exchanges. The lack of an actual trading education, coupled with the low total capitalization on some exchanges (HitBTC is a good example), magnifies every pump, and worsens every dump. The term is called weak hands, but it's more than that; people in this space react too much off of news, and way too late after the news has dropped. In other words, lack of trading experience ;)

The price is also manipulated to shit, because of the low total capitalization ;) compared to forex, these positions are drops in a bucket.

Indeed, mostly people use it for trading but there are a lot of people who store their wealth in bitcoin as well.
Another reason why bitcoin price so volatile because it's decentralized digital currency, different with fiat currency such as USD or Euro which backed by government.
Without any backup, bitcoin stand alone with people who support and trust it'. Bigger market cap or higher price make it more volatile, because if people sell their bitcoin could make its price drop even more.

Yes. I can see another point. Add 'lesser mainstream attention'. Bitcoin is highly underrated at the moment. Not many people use it, compared to fiat. When suddenly a large company like Amazon or eBay accepts Bitcoin, media companies would jump on it. Thus new members in the network increase demand...for a short time. Afterwards, people begin realising how useless Bitcoin is in their real life and leave the community. When masses of people leave the network like this, the price drops.

The only governing force is kinda the buy power and the vision of the people. If people or India or Japan choose to look at bitcoin, it would pass any prediction. While governments try to have the least control by legislations.

well the main reason is very simple as long as bitcoin is based on supply and demand there will be volatility

fiat it's not based on that and it's the reason why the value is fixed, the spread is due to economy trading or financial problems

also another big reason is because the distribution is still bad, I can bet my ass hat there are still big early adopters in play

Bitcoin is decentralized so we can expect too much price movement for bitcoin because it is just a flexible currency because of the dependency in supply and demand but even though the value or price of bitcoin is not fixed and it is often moving up and down, it is still a good thing to have for a currency because we can be a trader and make money from it.

Price regulation, Fiat is due to the policy of the national Bank. Bitcoin has no such mechanism, so it is doomed to regular racing. When people are excited about it I want to remind you that the exchange is always someone losing money, but at the expense of other people make them. To always be lucky and not so every trader is always in risk.

Precisely, because bitcoin would never be on where it is right now if there are no bitcoin users, investors, and so on, because of the demand and supply, bitcoin population is growing even more than we are expecting. Bitcoin is not popular to the ordinary people who only know fiat where they are getting their source of income. This volatility is the reason why bitcoin is giving us hope that someday it could make us rich because its price would be higher than the sky in the near future.

If we are going to hold our bitcoin and continuing what we are doing right now, and not spending our bitcoin on the things that could be bought by fiat or something, then I could assure you that in the near future, expect that you are going to have millions of money in your hand.

I couldn't make out what you meant to say by that

You may have to try explaining it better or continue to laugh in loneliness (as they say, the louder the laugh, the emptier the head). Just in case, front-running client orders doesn't mean that the exchange places a sell or buy order "in front of buy or sell orders to lift or drop the price a bit". You can't earn sure profits by doing that, and if exchanges did actually place their orders in front of the orders of their clients (as you mean it), there wouldn't be anything criminal, illegal or otherwise condemnable in that. A hint, front-running has nothing to do with that. You may want to go and find out what it actually means (or you can continue laughing, I don't care)

All major fiat currencies have floating exchange rates

Which, as you can easily guess, are determined by the same good old supply and demand. It kinda seems you may want to learn more about Forex and specialized currency futures and options exchanges out there (e.g. CME (https://en.wikipedia.org/wiki/Chicago_Mercantile_Exchange) or MICEX (https://www.moex.com/en/)). When you are done, you will learn that the rates of such currencies as the US dollar (more specifically, the US dollar Index), Swiss franc, Euro, etc. are determined in pretty much the same way as the prices of Bitcoin and its buddies, altcoins

The increase and decrease in demand of bitcoins is the main reason for volatile nature of biytcoins.In other currencies,governments control it and to maintain stable price,governments also changes their policies as per the market situations.But in bitcoin,there is no such central body to control the price.Bitcoin directly reflects its value all time.Hence the volatile nature.

There is a new token coming up that will tackle the issue of volatility through automatic diversification and AI trading. ICO is on September 14.
https://bitcointalk.org/index.php?topic=2114287.msg21143521#msg21143521
https://x8currency.com/
slack: https://x8currency.herokuapp.com/

In my opinion the main reason of volatility is that Bitcoin is only used for speculation and it doesn't have an economy yet.

Big governments don't need to interfere very often

And when they do in fact interfere in the market, it is certainly not about "fixing" the exchange rates but rather affecting the national economy itself. The currency exchange rate itself is an outcome and result of the economic policies that respective countries are following. My point is that it makes no sense to regulate the exchange rate directly as well as go for stable rates (as the primary goal, at least). Stable rates are the effect of strong and robust national economy, and that should be the top priority