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Author Topic: Why is Bitcoin value more Volatile?  (Read 4208 times)
botany
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August 16, 2015, 01:24:27 AM
 #61

It's simple, it's too small at the moment. The marketcap is too small and order books are too thin. Today, a 1 so called whale is enough to move the price up or down by $20, with 1 sell or buy.

Now imagine if Bitcoin marketcap was 10 times higher or around $30 billion, well to move the price by $20 it would be also 10 times harder.

Not only that, currently most of the bitcoins are with day traders they won't allow prices to stabilize otherwise their profits will go away.

Well that too, since the market is so small and easy to move, Bitcoin is pretty much a safe haven for speculators. They know exactly what to do and how to move the market in order to maximize their profits.

However, looking at the Ethereum pump at the moment, it seems that all of the speculators at the moment are in the ETH/BTC market.

Bitcoin's market size may be small, but it is substantially bigger than all the alts put together.
So somebody going for a pump and dump will be better off targeting any one of the alts.
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bitcollins85
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August 16, 2015, 04:37:19 PM
 #62

Bitcoin is an emerging digital currency. The demand and supply of bitcoin is changing in every second. So the bitcoin value is volatile more than other currency.
that's because the market cap is still so incredibly small, as Bitcoin becomes more and more popular, the market cap is larger, the stability of Bitcoin will increase
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August 17, 2015, 03:23:06 AM
 #63

bitcoin is considered as a commodity than a currency. Bitcoin is not tied to the strength of any particular country economy and these are under control of a any big institutions. But price is set by those who sell bitcoin so when there is a more rush by people to buy bitcoin for some reasons then price will move up very fast and it will come back also so fast after demand cool down.
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August 17, 2015, 07:05:44 AM
 #64

bitcoin is considered as a commodity than a currency. Bitcoin is not tied to the strength of any particular country economy and these are under control of a any big institutions. But price is set by those who sell bitcoin so when there is a more rush by people to buy bitcoin for some reasons then price will move up very fast and it will come back also so fast after demand cool down.

Also as of now only traders are holding much of these bitcoins hence they usually trade every day for some profit so these prices are very volatile.
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August 17, 2015, 11:57:22 PM
 #65

The reason why Bitcoin currently has a higher volatility than most other currencies is that it is still in its infancy and has a comparatively low market capitalization.

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August 18, 2015, 04:44:23 AM
 #66

Although volatile, it's decentralized, which explains the reason it can be unstable. The thing about fiat currency is the fact that it's controlled by a 3rd party entity, meaning the value can be falsified in ways (like inflation). Bitcoin inflation doesn't exist. The price is on trading volume alone, and that's value is what the users make of it. Once currency fails, you're pretty much done for and all the money that once had value is worthless paper. imo, Bitcoin won't become worthless.
ajun96
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August 18, 2015, 06:10:16 AM
 #67

The reason why Bitcoin currently has a higher volatility than most other currencies is that it is still in its infancy and has a comparatively low market capitalization.
until when infancy of bitcoin?


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n2004al
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September 27, 2015, 03:43:26 PM
 #68

Bitcoin is an emerging digital currency. The demand and supply of bitcoin is changing in every second. So the bitcoin value is volatile more than other currency.

No it is not true. Bitcoin is volatile because is an emerging digital currency. The demand and supply of bitcoin is changing in every second. So the bitcoin value is volatile more than other currency.

Very hard to learn this. Months and months of study and independent work in mining to find those above. Congrats to myself!

Sorry mate but it is very funny your thread. I don't understand what do you want with it. Maybe there even other factors that have impact on volatility of bitcoin but are casual and cannot be told before they happen. It is all that can be told.
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September 27, 2015, 06:03:29 PM
 #69

In my opinion, the following basic indicators make a cryptocurrency more volatile:

1. small market (Bitcoin is the biggest, but still small)
2. PoW based security model, because it tends to amplify price swings (basically: miners hold when price goes up, but sell when price goes down, the difficulty swings are the main reasons for this phenomenon)
3. a fixed supply, because there is no flexibility to react to demand swings
4. more short-term investors than long term investors
5. little usage, because usage usually stabilizes the price a bit

In some of these items, Bitcoin has made progress in the last years (1., 4. and 5.) while others are impossible to change (2. and 3.) because they are defining parts of the protocol. For these reasons, I basically expect the volatility will drop a bit more, but will never reach the stability of most state-issued "fiat" currencies.

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September 27, 2015, 06:22:17 PM
 #70

The reason why Bitcoin currently has a higher volatility than most other currencies is that it is still in its infancy and has a comparatively low market capitalization.
until when infancy of bitcoin?

I think it will not stable forever. it will more volatile when the demand is increase, because the supply is limited.
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September 27, 2015, 06:32:10 PM
 #71

The reason why Bitcoin currently has a higher volatility than most other currencies is that it is still in its infancy and has a comparatively low market capitalization.
until when infancy of bitcoin?

I think it will not stable forever. it will more volatile when the demand is increase, because the supply is limited.

Maybe you are wrong. That depends from the meaning you give at the expression "it will not be stable forever". If with that you mean that it will be always volatile because the reasons you give ongoing you are in big wrong. With time bitcoin will be more stable every day more. The amount of bitcoin is fixed and the demand for it will be increased (as it is told even from you). This will increase his price but not its volatility. The price can go down but far less and rarely than nowadays and in much more less than the amounts of nowadays. The tendency will be the increase of price and this is called appreciation and not volatility.

If with your expression you mean other meaning name it concretely to be understand without doubts and my explanations would be in vain.
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September 27, 2015, 06:48:39 PM
 #72

The reason why Bitcoin currently has a higher volatility than most other currencies is that it is still in its infancy and has a comparatively low market capitalization.
until when infancy of bitcoin?

I think it will not stable forever. it will more volatile when the demand is increase, because the supply is limited.

Maybe you are wrong. That depends from the meaning you give at the expression "it will not be stable forever". If with that you mean that it will be always volatile because the reasons you give ongoing you are in big wrong. With time bitcoin will be more stable every day more. The amount of bitcoin is fixed and the demand for it will be increased (as it is told even from you). This will increase his price but not its volatility. The price can go down but far less and rarely than nowadays and in much more less than the amounts of nowadays. The tendency will be the increase of price and this is called appreciation and not volatility.

If with your expression you mean other meaning name it concretely to be understand without doubts and my explanations would be in vain.

Correct. sorry i means not stable if it compare to fiat movement price.

I means volatile here is the price yawn, and if the price go down, the price is will not significantly touch nowadays low price(if that whale not sell all their coins). the price is volatile if it compare to fiat.

All is depends on supply and demands.
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October 15, 2015, 01:46:57 AM
 #73

I agree with long-term stability, This is a time in BTC history that needs to be left to the true risk takers and entrepreneurs
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October 15, 2015, 03:00:11 AM
 #74

Bitcoin is an emerging digital currency. The demand and supply of bitcoin is changing in every second. So the bitcoin value is volatile more than other currency.

The value of bitcoin would really be volatile since it is a digital currency.  It operates independently of a central bank.
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October 15, 2015, 04:09:23 AM
 #75

Bitcoin is an emerging digital currency. The demand and supply of bitcoin is changing in every second. So the bitcoin value is volatile more than other currency.

The value of bitcoin is volatile because bitcoin is not tied to any country or subject to regulations.  It is also created by a man named Satoshi Nakamoto whose identity is still in dispute.
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October 15, 2015, 05:06:53 AM
 #76

It is volatile because it is very manipulated and not controlled by any instituion
besides, the market is not really big
Bitcoin market is not big? For me it is quite different. Look at this chart: https://blockchain.info/charts/market-cap
And I don't think that volume of market brings stability.

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October 16, 2015, 01:23:08 AM
 #77

It is volatile because it is very manipulated and not controlled by any instituion
besides, the market is not really big
Bitcoin market is not big? For me it is quite different. Look at this chart: https://blockchain.info/charts/market-cap
And I don't think that volume of market brings stability.

Less than $4 Bn is big? That is chump change.
Apple Inc is valued at more than 100 times Bitcoin's market cap and that is just one company.
So yes, the potential to grow is huge.

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October 16, 2015, 12:53:11 PM
 #78

Bitcoin is an emerging digital currency. The demand and supply of bitcoin is changing in every second. So the bitcoin value is volatile more than other currency.

so you answered in your post question from your subject. masterpiece, congratulations.

This is really amazing Frequently Ask Question.

Q: Why is Bitcoin value more Volatile?
A: Bitcoin is an emerging digital currency. The demand and supply of bitcoin is changing in every second. So the bitcoin value is volatile more than other currency.

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