Bitcoin's volatility is a non-issue

[satria2]

I know that this subject has been discussed many times before, but lest we forget when yet another conventional financial journalist, investor, money manager, perceived thought-leader et al pronounces on why Bitcoin will fail because it is too volatile to be used as a currency or store of value:

• Each Bitcoin transaction is a zero-sum game -- one party benefits to the same extent that the other does not benefit. So one party is guaranteed always to be fine with the volatility. And neither party knows for sure (or at all) who that beneficiary will be.
• The purchaser of a bitcoin has still spent the same amount of fiat no matter what the volatility after the purchase.
• The premise that the aggrieved party could have done this or that instead of send someone a bitcoin that later appreciated in value has no more merit than to say that that party could have bought a stock or bond that later did well too. In each case, they simply did not have the information needed in time. Shoulda coulda woulda is not a valid argument.
• If Bitcoin were impractical as a currency, the dark web would not use it. There would be no Bitcoin-using dark web. 
  
• Many things have been used as currency. Anything tradeable and of proven long-term value (like gold) or expected shorter-term value (like packs of Kent cigarettes in communist Romania) can be used as a practical currency, and have. Before WWI, travelers checks had the rate of conversion printed on them because it was expected that the gold-back currencies backing them would be stable. And so they were. The fact that fiat currencies require electronic conversion-rate signs today shows that their stability is entirely an illusion. They are not stable.
  
  

The argument that Bitcoin's volatility specifically negates its value as a store of value is clearly false as well. Stocks and commodities and their futures (as well as the effective interest rates of some bonds) are highly volatile. The mantra is that you accept their risk in exchange for growth. Fine. But volatile Bitcoin has growth potential too -- lots of growth potential. Both Bitcoin and Ethereum, as systems of decentralized, immutable, economical, sustainable, and perfectly legal data-registration means that everyone will become their own notary public. The implications for intellectual property protection are arguably beyond what we can now imagine.

Underlying all of Bitcoin's volatility is an unchanging protocol that is proven to work -- and expected to grow.

cryptocurrency tries to imitate forex, where the volatile impact is not so great, it will still be difficult because the use of crypto is still not comprehensive. so it's easy with price manipulation by several groups

If you can manipulate prices it will have its own anxiety for people who are afraid to see prices drop now.

[gogrowglow]

Traders are happy with Bitcoin's volatility because it can be an opportunity to earn more money but for a few who are still a newbie here, it can be viewed  differently as they will get confuse of the fast  movement of Bitcoin value in the marketplace.  Mostly for  old  members and experienced people here,  Bitcoin's volatility is not an issue because,  they are used to it and they make use of it.   They can form a strategy on when to trade their coins by just watching closely the market.

[Asawakobana2017]

It is never an issue, the issue is the lose of the people who didn't have enoughf patience to hold. I believe that the bitcoin or maybe crypto is really unstable from the beginning so we don't need to have an issue about it. Bitcoin is a great way to earn but if we loss on it the problem is maybe on us not on bitcoin.

[Naughty Princess]

It is never an issue, the issue is the lose of the people who didn't have enoughf patience to hold. I believe that the bitcoin or maybe crypto is really unstable from the beginning so we don't need to have an issue about it. Bitcoin is a great way to earn but if we loss on it the problem is maybe on us not on bitcoin.

I agree. There no issue about the volatility of bitcoin because without it, traders cannot gain profit from it for a short period of time. The volatility helps to have an opportunity to earn bitcoin and buy volume at lower price. Volatility helps to acknowledge about everyone about the supply and demand of it on the market and makes it popular for investments.

[Rashid555]

Bitcoin volatility is not issue but it is a factor which should be considered before investment to this side and for now i hope that bitcoin is so volatile and thus we should take care of volatility before investing in the crypto sector.

[Camilla Gill]

Price volatility is often bad for transaction of value. Say I buy a car now for 1 bitcoin and the fiat exchange rate doubles in a year, i've effectively spent twice as much on that car compared to paying in fiat. Alternatively if i sell a car for 1 BTC and the price crashes, i've lost money cause my real world expenses are in fiat. If i only bought and sold goods in crypto, 1 BTC would always equal 1 BTC and it wouldnt matter, but because we have to transact in both, volatility makes it hard to use.

[Falmera]

My opinion is that if bitcoin was not so volatile that wouldnt suit traders.
Traders love the volatility, well experienced traders that is, the ones who
Can read the charts etc.

And if bitcoin was not so volatile there could probably be mor acceptance
in the marketplace for it to be used as a currency.

I agree. Its volatility might excite many investors since there are chances of earning big in just for a shorter time. But, bitcoin might replace fiat if it is not volatile.

[maxim000]

But still Bitcoin will be impractical to use as a currency when it comes to mainstream market and when fiat is a better alternative available. Dark web uses cryptos for hidden transaction and for leaving no money trails. It is bit convenient to use cryptos than fiat in dark web.

I still believe high volatility is a problem when it comes to mainstream acceptance of Bitcoin as a currency.

[Dylan Bargeman]

Because the price is volatile, nothing is denominated in it. Because you don’t know how much of something you will be able to buy with it, you won’t hoard it. It wouldn’t be an issue if it weren’t for Digital Gold people...
If one assumes Bitcoin is just a currency meant for transacting, day to day volatility isn’t a big problem.

[mensahkkofie]

I beg to differ, bitcoin volatility is always  causing people to partake in panic selling. People would always get scared at a huge drop in price of bitcoin. I think this is a problem that needs to be given the needed attention. This is a very serious issue with respect to investor confidence.

[fosco333]

Indeed, it will be no problem if you using it for trading. But imagine when you using it as a currency.
Imagine that you can buy a car in december 2017 with only 1 btc, and now you cannot buy any car because the price of btc has dropping.
Volatility won't become an issue if you not use it as a real currency like fiat.

[zoeylee]

I think for those investors that really knows the market value of bitcoin maybe they will not think it as non-issue but for those newbies on this kind of file maybe it is a big issue.

[DigitalCyberius]

Although Bitcoin is extremely cool, and although there are some concerns, I think there are a few points in your message that should be addressed:

#1. A currency, regardless of whether Bitcoin can be properly defined as such, is not necessarily sound money (like gold/silver).

#2. "... one party is guaranteed always to be fine with the volatility." This is not true. You would need to be actively trading and gaining profits on both the ups and the downs to be always fine with the volatility.  

#3. "The purchaser of a bitcoin has still spent the same amount of fiat no matter what the volatility after the purchase." - this negates the argument, as yes they've spent the same amount of fiat, but if Bitcoin swings down and stays down, then they've lost value, and can only hope it will return. While this may also be true with other assets, it is not as likely as it is with Bitcoin, it would seem.

#4. Comparing to stocks, and shoulda, coulda, woulda... the argument seems to be more along the lines that Bitcoin is much more volatile than these assets, and higher volatility is not favorable as a store of value. It can be highly liquid if you plan on actively trading it, and have the ability to confidently predict it's next price movement in time.

#5. "If Bitcoin were impractical as a currency, the dark web would not use it." This is not necessarily true, as the dark web is often proliferated by illegal activities and morally depraved things, Bitcoin offers (or at least it did offer) the promise of anonymity, which is exactly what such people who engage in these activities want.

#6. Stocks and bonds are highly volatile as well. Bitcoin has growth potential as well - to my current, limited understanding, Bitcoin is still MUCH more volatile than stocks or bonds. When you invest in a stock or bond, you are not expecting to lose $500 a stock in one day, and gain $1,200 in two weeks, and then lose $800 in half a week, etc (just examples, nothing specific). Potential growth - while there are some who believe the entire paper market is in trouble if the economy crashes, there are also others who believe that Bitcoin could go to zero or near zero based on its nature, lack of intrinsic value or even connecting to or representing anything of intrinsic value, and the circumstances we find ourselves in. It could continue to grow, but we shall see.

#7. Even if BTC is useful as a currency or mode of transaction (which it is to an extent), it is not necessarily ideal for storing value, not only because of the high volatility factor, but also for the fact that it is purely digital. What will you do if the internet gets shut down/censored, or if the power goes out, or if the government finds a way to censor it, etc?

Just some food for thought.
The Cyberius team.

[globalking]

yes it is a non-issue but some people and some media are creating fear amount investors and benefiting themselves people has to understand that.

[bagsat]

Entering in this kind of system must accept the fact that bitcoin's volatility is in its nature. Bitcoin has no exact value that it depends on how the flow of investments and tradings are.

[Soots]

Proper education, awareness, bravery, and open-mindedness, all of these play a big role in the world of cryptocurrency. Volatility has been the nature of Bitcoin but most of us have viewed it into something disadvantageous. We must learn to understand and weigh things out of the advantages and disadvantages of its functionalities. Volatility is a sign of growth and profit. It's never going to be an issue if we realize how truly beneficial this technology is. It's very important to always do research, explore, and discover it yourself of what is the true essence of Bitcoin, than barely listening and reading from fake sources of information. Authenticity is what we value and we should start doing it.

[saumang2m]

I do not think that we should be afraid of that volatile market of Bitcoin. Because if the Bitcoin market stabilizes, we will not have any special benefit from it. And due to being a volatile market, we often get good profits. Therefore, the volatile market is proving to be good for us.

[katerinaliisa]

I think the volatility is getting lower every year. I do not understand what it is connected with, but I constantly analyze this situation. By itself, volatility is perceived by people in different ways. For someone, a stable market is a great situation for trading, although I do not understand how you can earn good money in a relatively stable market. The cryptocurrency market has always attracted people with its volatility.

[biskitop]

indeed there is no problem, it is precisely the main problem that is the function of bitcoin towards real estate to be used as a means of payment. Bitcoin should be more focused on becoming a payment instrument, and forget for a moment about volatility.

[gheawari431]

It is never an issue, the issue is the lose of the people who didn't have enoughf patience to hold. I believe that the bitcoin or maybe crypto is really unstable from the beginning so we don't need to have an issue about it. Bitcoin is a great way to earn but if we loss on it the problem is maybe on us not on bitcoin.

Bitcoin as an investment is very good because many have proven its success. If the price drops now, that is very reasonable. It is predicted that soon the price of bitcoin will rise. Many issues hit, even attacking bitcoin, but bitcoin will not die. Bitcoin users continue to trade, because of the high belief that bitcoin is a digital currency that will someday be used globally.