Why is bitcoin so unstable?

[crwth]

Basically, there is a lot of speculation with Bitcoin. Everyone can be considered a speculator. It would just depend on what approach the person would do. Examples are

• Trader - Speculating always depending on the market trend
• HODLer - speculating that the price would go up
• Bounty Hunter - speculative approach to different projects
• Watcher - just spreading the news on what goes by with the crypto world, helping the hype

Depending on who you are would contribute the smallest amount on the market, but most of the movement comes from whales and trading bots for sure.

[peterpanda]

Gold and bitcoin is not same thing here. Gold is familiar and running from ancient where bitcoin is new and many people are not familiar with bitcoin. That's why bitcoin is unstable.

[MCobian]

I agree that Gold is also unstable like Bitcoin, but Gold is less volatile. Many people consider Gold stable, but the reality is not like that.
The price of Bitcoin is very volatile and unstable because it is new, so Bitcoin holders not as much as Gold. More and more Bitcoin holders
should be making less volatile, moreover many countries that legalize Bitcoin should the Bitcoin price be more stable.

[taufik123]

There are many reasons why bitcoin has become unstable, one of which is because Bitcoin is a new technology that is still unknown to ordinary people. The new technology will go through a hype cycle which at first was only known and used by a handful of people, then slowly the new technology is used by the general public and suddenly there will be some opinions that appear or with exaggerated statements about the new technology.

This is what makes bitcoin price very volatile, investing in Bitcoin will also affect emotions. A lot of good and bad news will be scattered around trying to influence the price of bitcoin.

[mezzaluna]

Gold is another store of value, but not that unstable. It reached 2000$ recently and was above 1000$ for many years. Those who invested in gold back in 1900 would have made a great choice since it costed only 20$ back then if I'm not wrong. (Although dollar was way more strong than now)

Bitcoin can lose 500$ within one night. Gold can't. Why that?

That is actually good right? Since Bitcoin being unstable can provide lots of opportunities for us users investing on it. Some are saying that Bitcoin is the equivalent of Gold in the Digital world but we are now seeing some Alternate Cryptocurrencies that is being backed by Gold and that is some advancement in the Cryptocurrency Industry.

[Latviand]

Although gold is a limited natural resource, but gold will continue to be produced every day, week, month and year which will make it continue to grow. Whereas bitcoin only has a total supply of 21 million which makes it rare. If limited natural resources such as gold are no longer produced through mining around the world, I believe the volatility will be much higher than it is now.

Gold and BTC both have limited supplies but the only difference is that we are aware about bitcoins total supply in the world while we don't have any idea about the total number of gold.

Du to that awareness about their count, I must say that bitcoin is much volatile and can become more profitable in a short-period of time. While Gold is good for a long-term investment or holding because it is true that it has a changes in its price but not as huge as bitcoin. But if I will choose between the two, I will try to invest on them and prioritize the use of bitcoin much more.

[VanityWallets2015]

Bitcoin is a recent product of technology, an online entity, made with a volatile nature.
Gold, on the other hand, is an entity existing for centuries, which is much valuable.
These two cannot be really compared since their origin is very different.

[Bitcoin_bullish]

Those who invested in gold back in 1900 would have made a great choice since it costed only 20$ back then if I'm not wrong. (Although dollar was way more strong than now)

According to this website (link), $20 in 1900 is worth around $617 today so gold was indeed a good investment (inflation-adjusted) as it is priced close to $2000 today. The real price of gold is at a 3x premium currently since 1900. It is a great investment but not as much as you think as the dollar is a fiat currency prone to constant devaluation through excess printing and inflation.

Bitcoin can lose 500$ within one night. Gold can't. Why that?

Gold is a nine trillion dollar market currently. Losing 25% of its value would require a massive event that would result in liquidations of reserves of Central Banks.

Bitcoin's market cap is currently just a fraction of gold. Still, if you look close to Bitcoin's chart from the beginning the dips are less frequent and to a less extent as in the past. It is believed that in case Bitcoin manages to reach gold's market cap (~$450,000 per BTC) price will have way less fluctuation.

Perhaps a macroeconomist can shed light on this.

[jpnl0006]

Bitcoin was designed to have its price regulated by market forces adn not peged to any particular fiat or commodity. It is therefore at the mercy of traders to regulate the price and therefore expose it to volatile market forces. It will remain volatile thereby keeping the price unstable for a very long period of time and also proving to be a worthy investment for traders.

[rodskee]

Somehow that difference is really big, having gold has its physical appearance assure the one who has it unlike to bitcoin which is a digital currency that doesn't have a physical thing.

With your argument, it can be added that gold are being use in more other things unlike bitcoin which mostly
use as store asset and payment transaction process.

Bitcoin could reach a low amount of market price easily because of that difference, it just gold can be more valued and bitcoin was just because of the demand in the market.

More on speculations where bitcoin get its value, investors trust and adoptions coming from businesses make
more newcomers to have interest to invest
with this investment currency, the value depends from people who trusting the system unlike gold where it's
been decade far from the value that it have now.

[jerrison]

The whole concept of Bitcoin was not for it to be pegged to fiat or any stablecoin but to create a digital value that is void of interfernece from government agencies and international financial policies. The deccentralised technology leaves everything about the technology in the hands of the traders who at every point in time choose what to do and what to sell of their digital property, hence, the volatility of Bitcoin price.

[Viglione]

Bitcoin is cryptocurrency. we use it from last some years.Other Hand gold  use from   many many years ago.so, gold is stable.

[Mahanton]

Gold is another store of value, but not that unstable. It reached 2000$ recently and was above 1000$ for many years. Those who invested in gold back in 1900 would have made a great choice since it costed only 20$ back then if I'm not wrong. (Although dollar was way more strong than now)

Bitcoin can lose 500$ within one night. Gold can't. Why that?

Simple.

Bitcoin = Digital currency/ not backed by government/ Decentralized / not considered as asset,stocks etc.

Gold = Precious metal/ Does have physical form.

You can compare the two but you cant really able to push that they are similar.Bitcoin price movement does always signify about supply and demand but we can actually
able to see the difference about price volatility.

[semobo]

Gold is another store of value, but not that unstable. It reached 2000$ recently and was above 1000$ for many years. Those who invested in gold back in 1900 would have made a great choice since it costed only 20$ back then if I'm not wrong. (Although dollar was way more strong than now)

Bitcoin can lose 500$ within one night. Gold can't. Why that?

Availability of Gold is vast compared to the availability of bitcoin and also Gold earned the trust because it has been used as form of currency and assets for centuries but bitcoin was just created a decade ago so it is not dispersed as Gold so people who got more of the bitcoins can easily trigger the price manipulation.

[carlisle1]

Bitcoin instability when it come to it price shouldn't be compare to stable currency or stable coins. Gold itself isn't stable but less volatile if compare to Bitcoin. Also, remember that, Gold has been in existence compared to Bitcoin which came into existence just some few years ago, so, why comparing the two?. Believe me, Bitcoin will definitely be less volatile if it exist as much as gold. Gold, Silver, Diamond and Oil aren't stable but less volatile compare to Bitcoin and they have been in existence from ages.

Gold established It's value way back being classified as precious metals the existence already being embraced all over the world,
there's no place that won't recognize gold.

While with bitcoin, we can say that it's not that much who understand this system, value depends from how traders and investors
make their moves.

In terms of existence, let time to decide what future will be for bitcoin and how big it will turned after being adopted by more end users
around the world.

[FlightyPouch]

Gold is being used as a reserve of the countries, the potential of it increasing is so high. Bitcoin is decentralized, and that is the reason why it is volatile. We investors and users are the ones that control the movement of the price of bitcoin, without anyone controlling it, our every move in the market ripples making an effect to the price.

[posi]

Gold is another store of value, but not that unstable. It reached 2000$ recently and was above 1000$ for many years.

Gold is a safe haven commodity but it has also downtrend to $1968 right now.

Those who invested in gold back in 1900 would have made a great choice since it costed only 20$ back then if I'm not wrong.

This is the betterment early investors of very potentials investment always enjoy and it never too late for us all to invest in Gold before it too late.

Bitcoin can lose 500$ within one night. Gold can't. Why that?

Bitcoin is volatility in nature and the level of demand and supply in the market are what determines its price. Gold in the other hand is a government supported and well adopted precious metal around the whole world. However, there is a limited gold mining factory these days, and I also read that there is 30% of the gold left to mine around the world. I believe these are what trigger the surge in the price of gold lately.

[suryogandul]

bitcoin was created for commerce and like money, it rotates very quickly. gold was created for savings so turnover of gold is very little and slow. that's why bitcoin is currently unstable, because the turnover of bitcoin every time is very fast and high

[Savemore]

Gold is being used as a reserve of the countries, the potential of it increasing is so high. Bitcoin is decentralized, and that is the reason why it is volatile. We investors and users are the ones that control the movement of the price of bitcoin, without anyone controlling it, our every move in the market ripples making an effect to the price.

Gold is valued based on different factors that aren't a speculative event for the cryptocurrency markets. As cryptocurrency is speculative it reacts to any small changes in the market volume due to any of the incidents happened relative to the cryptocurrency market. This at times cause large level fluctuation, which is the reason for unstable situation prevailing with cryptocurrency market.

Another thing is the market size and the liquidity level. Compared to gold the market of cryptocurrencies were very low, maybe when the market size grows we can expect more stability.

The volatility of the bitcoin is normal and it is really one of its characteristics, what is not normal if the price became stable. The reason why the price of the bitcoin is always changing minute to minute because of the huge market participants, there are a lot of people who constantly buying and selling bitcoin. Be also aware that the market is driven by emotions especially by greed and fear. If the market is uptrend, the main emotion is greed where people keep buying and the price of the bitcoin keep increasing while if the market is bearish the market is driven by bearish where the price is gradually decreasing. In terms of comparing the price of the gold and bitcoin, bitcoin is more volatile but gold cannot consider as stable especially when talking about gold futures market.

[charlesmichel1]

If you want to know why Bitcoin is so volatile, you should answer the question "why do Bitcoins have value?". It's impossible to name a single reason. Bitcoin's price and volatility depend on many different factors.