Why Bitcoin Is So Volatile

[HiringYou]

Bitcoin is known for it's volatile nature.Sometimes the price  is low and sometimes the price is high so these fluctuations are quite common in case of Bitcoin.Bitcoin is type of cryptocurrency which is affected by even a small statement due to which it's price get affected.Whenever a country takes a decision about Bitcoin whether it is a postive one or a negative one,it effects the price all over the world.For example when China banned Bitcoin, a huge drop was seen in it's price.That JP Morgan's statement about Bitcoin also affected the price.Recently we saw a drop in the price when India banned Bitcoin.This is because such decisions make investors to sell or invest more in Bitcoin which further affects it's price.These are the reasons due to which Bitcoin is volatile.

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[bohr]

Bitcoin is so volatile because it has not reach its real value yet and at the same time its demand is increasing on a daily basis because it is a new form of currency that is yet to be accepted world over.

That is another reason, bitcoin has the potential of being extremely valuable and when you look at the potential price of bitcoin and at its current value you see that there is a big difference and until bitcoin does not reach its potential then the price still will move very abruptly, so the only thing we can do is to wait for the day in which bitcoin is adopted all over the world and hope that the volatility goes away.

[dx_twisted]

Governments indicate volatility to be one among the negative factor and fluctuate the market.

It only causes a negative feel because of the fact that they are not being regulated, its market value can be manipulated by those people who are in capable to transact at a higher volume. Also, another reason why the government warns people to take precautions is because of Bitcoin being digital, which is a clear sign that it may only be temporary as no physical sign to support that it will not fluctuate gradually, and the fact that it can be a tool for money laundering schemes.

[Sitipxz]

I don't buy that argument that Bitcoin is volatile because it has no intrinsic value to be backed upon. Nothing is backed by anything substantive! Fiat is backed by the monopoly power of the state, gold is backed by the social capital given to it. If Bitcoin's lack of physical asset backing was a problem, all currencies would be volatile.

Bitcoins volatility is not new in financial history. Earlier forms of currency like tobacco used in the early American colonies were much more volatile. Bitcoin's instability is just a demonstration of the market. Hype led to speculators buying up the supply, and scares by regulators and panic sellers caused price drops.

There is nothing intrinsic in Bitcoin, besides maybe slow and expensive transactions coming to the fore, that makes it volatile. It is a commodity, and like any commodity, is a slave to market forces - let it be euphoria or panic.

[Sled]

Governments indicate volatility to be one among the negative factor and fluctuate the market.

It only causes a negative feel because of the fact that they are not being regulated, its market value can be manipulated by those people who are in capable to transact at a higher volume. Also, another reason why the government warns people to take precautions is because of Bitcoin being digital, which is a clear sign that it may only be temporary as no physical sign to support that it will not fluctuate gradually, and the fact that it can be a tool for money laundering schemes.

I agree to your statement because that is exactly what they are into and that is the reason why they are telling people that they should not trust the bitcoin because of its volatility that can lead them to lose and also it is not permanent since the government can ban it anytime because of the risk of the anonymity that can lead to be used as a tool for illegal transactions.

[reyblack]

For me i think many of us invest bitcoin in a short term investments that bitcoin may go down and rise instantly. For me it's best for all of us and bitcoin itself if we hold our coins not to sell them right away in just little rise of price at the market. We should trust bitcoin because that's what i do and bitcoin never fails thru patience.

[jostorres]

I don't buy that argument that Bitcoin is volatile because it has no intrinsic value to be backed upon. Nothing is backed by anything substantive! Fiat is backed by the monopoly power of the state, gold is backed by the social capital given to it. If Bitcoin's lack of physical asset backing was a problem, all currencies would be volatile.

Bitcoins volatility is not new in financial history. Earlier forms of currency like tobacco used in the early American colonies were much more volatile. Bitcoin's instability is just a demonstration of the market. Hype led to speculators buying up the supply, and scares by regulators and panic sellers caused price drops.

There is nothing intrinsic in Bitcoin, besides maybe slow and expensive transactions coming to the fore, that makes it volatile. It is a commodity, and like any commodity, is a slave to market forces - let it be euphoria or panic.

I feel that false statement and some government decision are the reasons for volatility in bitcoin price. You are right that bitcoin is not back by anyone but some people wants to hold a large quantity of bitcoin and for that they regularly attack the image of bitcoin, so that people sell their holdings and they found the opportunity to buy them on low price.

[gamalzour]

Governments indicate volatility to be one among the negative factor and fluctuate the market.

It only causes a negative feel because of the fact that they are not being regulated, its market value can be manipulated by those people who are in capable to transact at a higher volume. Also, another reason why the government warns people to take precautions is because of Bitcoin being digital, which is a clear sign that it may only be temporary as no physical sign to support that it will not fluctuate gradually, and the fact that it can be a tool for money laundering schemes.

The worst thing is that many countries have banned bitcoin like my country and this became the reason for volatility in the price. When the good image goes on about bitcoin more people invest in bitcoin and the price rise and when someone gives false statement and create negative image of bitcoin, the people withdraw their money and price falls.

[Irvinn]

Bitcoin is unstable because it is not provided with anything and there is no body that regulates its price, as Central Banks do with national money. Since bitcoin is decentralized, volatility will seem to be inherent in it always. And, I think, volatility with the growth of the price of the bit is going to increase.

[faceoff97]

Bitcoin is volatile simply because the demand changes from time to time. People tend to stop holding and just dropping, Bitcoin's value is all dependent on the people's decision. No one has the full control over Bitcoin's price, its decentralized which means it has no one who intervene over it. The value may change drastically when whales intervene, the actions of whales actually cause sudden but short term changes in values.

[Apaxy]

Bitcoin is volatile simply because the demand changes from time to time. People tend to stop holding and just dropping, Bitcoin's value is all dependent on the people's decision. No one has the full control over Bitcoin's price, its decentralized which means it has no one who intervene over it. The value may change drastically when whales intervene, the actions of whales actually cause sudden but short term changes in values.

in some situations the price of Bitcoin is not at all dependent on market demand, as it has already been observed more than once when the supply and demand were at the same level, but the price had huge fluctuations.

[Fedrey]

Bitcoin is volatile simply because the demand changes from time to time. People tend to stop holding and just dropping, Bitcoin's value is all dependent on the people's decision. No one has the full control over Bitcoin's price, its decentralized which means it has no one who intervene over it. The value may change drastically when whales intervene, the actions of whales actually cause sudden but short term changes in values.

in some situations the price of Bitcoin is not at all dependent on market demand, as it has already been observed more than once when the supply and demand were at the same level, but the price had huge fluctuations.

some experts spoke about the current situation on the market and offered users of crypto currencies to provoke a rise in the price for Bitcoin precisely the opportunities for increasing Bitcoin's demand in the market. Thus, Everyone had to give his opportunity to invest some funds in Bitcoin. But something this call did not live up to its expectations.

[Froloff92]

Bitcoin is so volatile because of its limited quantity when compared to other fiat currencies but the volatility rate keeps increasing with the bitcoin price rise so we never can have stable value with the bitcoin.

[pthnmj]

I think the most basic answer is because the Bitcoin market is actually really small. It’s also almost completely unregulated. A market being small means that it’s subject to wild fluctuations when people buy or sell large amounts of BTC.

[Britanshio]

For me bitcoin was so volatile because of supply and demand section that investors and holders that if they sell their crypto coins the movement qill goes up and down.

[NoNetwork]

Its pretty obvious. Having a very high price also comes a very high chance of fluctuation in its price, thus volatility. It will also depend on the demand, if there's a low demand then it will tend to have a lower price than expected, and if does have a higher demand then the price comes along.

[rejekinomplok99]

Bitcoin is volatile because there is a limited supply only and it is just 21 million bitcoins. It is also difficult to mine bitcoins because as far as I know it is divided into two after 4 consecutive years. I think that is the reason behind its volatility. Its price goes up when there is a great demand but the price becomes lower if the demand will goes down. It is a matter of scarce resources.

yes, thats right. there is a limited suplly of bitcoin. it can affect the bitcoin is so volatile.

[Bdstar]

I think the reason goes to the decentralized system, some big fishes are playing this type of role and they are always making this market volatile. on the other hand, Limited supply would be a great reason for this issue. But For me, acceptability around the world is the main culprit for this issue.

[jagmrx]

Honestly, I don't know what is the exactly reason on why bitcoin is volatile. The volatility of Bitcoin for me it's a normal and this I know on why, it's because of supply and demand.

Wow, what the hell is that suppose to mean ? I think the most basic answer is because the Bitcoin market is actually really small. Hahaha, I guess you misunderstand something. It’s also almost completely unregulated. Or am I the only one who does not know it. A market being small means that it’s subject to wild fluctuations when people buy or sell large amounts of BTC. Maybe you are right. Bitcoin is so volatile because of its limited quantity when compared to other fiat currencies but the volatility rate keeps increasing with the bitcoin price rise so we never can have stable value with the bitcoin. But that is the purpose of btc creation.

[swallovwvile8]

Heaven knows, I let it worked its way, its impossible to understamd btcs LOL