Why Is Bitcoin's Value So Volatile?

[millgates]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

There are a lot of factors thatmakes bitcoin is so volatile. Bitcoin is so volatile because most of bitcoin users are trader, this is a new concept of a payment system and bitcoin still not spread evenly. But it is not a problem because it is also a positive thing for trader to gain profit. The price of bitcoin will be more and more stable in the future.

[kamotharnn]

The number of people who are interested in bitcoin has increased which has made them buy more and more bitcoin. That is why the price of bitcoin is always volatile. Moreover, there are many traders and whales. They keeps buying and selling their coins everyday. FUD and rumors are also the main reasons which make bitcoin unstable. Bad news will make people sell their bitcoin and good news will encourage more people to buy it

[Akash1243]

I think that he reason behind the bitcoins being volatile is the increasing number of investors and people who are taking interest in bitcoins and investing in them.Also that bitcoin's value highly depends on demand of people which contribute to it's volatile nature.Bitcoins are still in developing phase that means it doesn't have full completed it is still being developed.And this volatile is one of the main reason of bitcoins success.

[Enzo 777]

makes its market still young and so small so it is not real value of it may be get 7500$ by the end of 2017 so buy and buy more

[DpremiumTrades]

bitcoin is a form of investment.

[acener]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

Whenever people invest a big amount of money in bitcoin it rises up, and when people withdraw a big amount of money it drops. This is the effect of investing and withdrawing bitcoin. The more investment in bitcoin the higher the price gets. There are some people who manipulate the price of bitcoin the entice people to invest.

[1Referee]

I think that he reason behind the bitcoins being volatile is the increasing number of investors and people who are taking interest in bitcoins and investing in them.

If we look through all the speculation and stuff, then the extremely poor orderbooks have been the major reason of why the volatility that we experience is this bad/severe/heavy. It's insane that a relatively low number of coins in current days, can get the market to sink with 10% in a matter of seconds - yes, you read that well, seconds. If we would be having one single orderbook, just like stocks are having, we wouldn't experience this level of volatility. Imagine how things will be when the entire world buys and sells through one single orderbook - it will make sure that the volatility that we experience with current severity, will be something of the past. It's practically impossible to force through such regulations to achieve this, but if people are looking for stability, this would be a convenient way of doing it.

[que91]

I think that he reason behind the bitcoins being volatile is the increasing number of investors and people who are taking interest in bitcoins and investing in them.Also that bitcoin's value highly depends on demand of people which contribute to it's volatile nature.Bitcoins are still in developing phase that means it doesn't have full completed it is still being developed.And this volatile is one of the main reason of bitcoins success.

Speculative is the main reason make the price of Bitcoin always has strong volatility. Just some rumors about China banned Bitcoin in their country, it has makes a huge number of traders on market sell their Bitcoin and created panic seller in past days.

[BUK2016]

Well bitcon is so volatile because is a currency that the volume or market capitalisation is still low as compare to most of the currencies in the world whose volume are so high to extent that no single event has significant effect on it value.

[Cofee.BLUE]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

Bitcoin's price rate is really volatile because it is also a type of currency that undergoes into pumps and dumps in the market but the only difference is it was a cryptocurrency generated online but still same thing applies into the price rate like the real money rate changes. The volatility of it happens because of the demand rate changes in the market of the consumers and potential investors that have been working on it.

[Wexnident]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

It is volatile because its market demand changes from time to time. Bitcoin together with other cryptocurrency are dependent with the demand in terms of its market price. Such that if the demand is low, its price will fall. Also it doesn't have a physical market value which I think affects it as an open source system. But the biggest factor that affects its volatility is its demand on the market.

[Von Braun]

What a good question! It is obviously a case of supply and demand, but perhaps the world wide nature of bitcoin and the speed at which information spreads (this forum being a case in point) creates more volatility than the spread of information in a conventional economy (where the noise of the Kardashian's alone interferes with the speed of economic signals).

[ModGirl]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

As many others have said here, the decentralized nature of the bitcoin is part of the reason for the extreme volatility.  There's no centralized entity, like a reserve bank, that can act to dampen the price swings.  Traders/speculators that are constantly buying and selling have an impact on the hour-to-hour price.  And the general lack of liquidity exacerbates the moves.

But one thing that I think most people are missing here is that there's no good way to determine the actual value of a bitcoin.  The value of other currencies is determined by the economies they represent.  The value of commodities (oil, gold, etc.) can be estimated from the amount of time/effort/resources/money that's required to obtain them.  But bitcoin doesn't have anything like that backing it, so there's no way to form a consensus on what it's value should be.  Without that, price is going to continue to swing wildly.

I think it’s natural for any currency either virtual or physical to be volatile because everything in the universe has ups and down. In case of bit coin, volatility is more visible because of increased number investors in it. As people are getting aware of crypto currencies, they have started investing in it to make huge profits in future.

[TitanGEL]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

It is volatile because it is dependent with its market demand such that if the demand is high, its value be expensive. And since the demand changes from time to time, its market value will also too. But you don't need to hesitate wheether to biy or not because if you have patience you will earn huge profit in the future since Bitcoin is continuously growing in all aspects from its market demand upto its market price.

I think you are correct. The reason why the value of the bitcoin is volatile is because the price of the bitcoin is depend on the demand of the people. The demand of the people nowadays to the bitcoin is so high and it is the reason why the bitcoin today is expensive.

[nkarm1]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

It is volatile because it is dependent with its market demand such that if the demand is high, its value be expensive. And since the demand changes from time to time, its market value will also too. But you don't need to hesitate wheether to biy or not because if you have patience you will earn huge profit in the future since Bitcoin is continuously growing in all aspects from its market demand upto its market price.

I think you are correct. The reason why the value of the bitcoin is volatile is because the price of the bitcoin is depend on the demand of the people. The demand of the people nowadays to the bitcoin is so high and it is the reason why the bitcoin today is expensive.

Generally this is the reason of the volality, but the demand of the users is technically affected by many factors. First as we have experienced, the factor of the news events exaggerated by the media like geopolitical events and announcement by the government. This is the main factor right now why the price is not comportable with its current price right now. Or other news like security breach can also affect the "demand". With all these fear, minority or majority of the user's might sell out their their coins which can give "more supply" available in the market added those btc that are freshly mined. So the price will go down. And after the price goes down, this is the time where majority of the traders will buy until they made the supply low. Then they will take profits so a sell out will happened. And that it the cycle on why bitcoin is so volatile. . This also happens to gold but it is not that volatile because it has been established for a thousand years. This is what happens to Bitcoin right now, as years passed by "according to studies" the volatility of bitcoin is reducing.

[Carlsen]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

It is volatile because it is dependent with its market demand such that if the demand is high, its value be expensive. And since the demand changes from time to time, its market value will also too. But you don't need to hesitate wheether to biy or not because if you have patience you will earn huge profit in the future since Bitcoin is continuously growing in all aspects from its market demand upto its market price.

I think you are correct. The reason why the value of the bitcoin is volatile is because the price of the bitcoin is depend on the demand of the people. The demand of the people nowadays to the bitcoin is so high and it is the reason why the bitcoin today is expensive.

Generally this is the reason of the volality, but the demand of the users is technically affected by many factors. First as we have experienced, the factor of the news events exaggerated by the media like geopolitical events and announcement by the government. This is the main factor right now why the price is not comportable with its current price right now. Or other news like security breach can also affect the "demand". With all these fear, minority or majority of the user's might sell out their their coins which can give "more supply" available in the market added those btc that are freshly mined. So the price will go down. And after the price goes down, this is the time where majority of the traders will buy until they made the supply low. Then they will take profits so a sell out will happened. And that it the cycle on why bitcoin is so volatile. . This also happens to gold but it is not that volatile because it has been established for a thousand years. This is what happens to Bitcoin right now, as years passed by "according to studies" the volatility of bitcoin is reducing.

That is about the same theory I have: there are too many emotions in bitcoin.
Emotions need time to cool off, but bitcoin knows no breaks. The exchanges are online ever!
That is creating a lot of pressure, especially to unexperienced holders.
They see a trend, get the feeling that they have to do something, and make very often the wrong choice.

[deisik]

I think that he reason behind the bitcoins being volatile is the increasing number of investors and people who are taking interest in bitcoins and investing in them.

If we look through all the speculation and stuff, then the extremely poor orderbooks have been the major reason of why the volatility that we experience is this bad/severe/heavy. It's insane that a relatively low number of coins in current days, can get the market to sink with 10% in a matter of seconds - yes, you read that well, seconds. If we would be having one single orderbook, just like stocks are having, we wouldn't experience this level of volatility. Imagine how things will be when the entire world buys and sells through one single orderbook - it will make sure that the volatility that we experience with current severity, will be something of the past. It's practically impossible to force through such regulations to achieve this, but if people are looking for stability, this would be a convenient way of doing it

You obviously don't see the forest for the trees (as always)

You blame the shallow orderbooks, but how many orderbooks of significance has come up recently? I can tell you, basically none. The total majority of bitcoins (if we talk about Bitcoin) are still traded at the top 3-4 exchanges (like Bitfinex, Bithumb, Bittrex and maybe a few others). So it is not about orderbooks as such, it is more about price itself. I've been telling that for years already, i.e. when the price rises high enough (and we seem to be there already), the supply will necessarily run dry. This is sort of a given. But when the supply runs dry, anyone can change it and thus dramatically affect the prices. This is the real cause of runaway volatility

[Dmitry.Vastov]

The demand of bitcoin and also the confidence of people make the bitcoin price volatile, if there is FUD created in market then the people will loose their confidence and will start selling their bitcoins.

[ajmapalo22]

Bitcoin has only limited amount circulating the market as well as number of people and establishment using bitcoin are very small which the price of bitcoin was affected by this factor but in future time when the demand of bitcoin continue to rise its volatility might probably change.

[amaral1977]

Why Is Bitcoin's Value So Volatile? I am confused to buy bitcoin now when it's value is too high.

I think it´s a very young investment with small real life use cases. So being a speculative asset it´s normal to have very big variations in price. That what makes it fun and is atracting so many people:)