Let's Stabilize Bitcoin

[laurenB7742]

In order for Bitcoin to be widely used for payments, it is necessary to stabilize price fluctuations.

Question,
Bitcoin and other currencies A and Prepare B.
A and B are equivalent exchangeable and can also be equivalently exchanged for Bitcoin.

Is it possible to stabilize prices through market mechanisms due to this?

We can’t make Bitcoins stable. The reason is very simple. Bitcoins are limited in numbers. Bitcoins were originally developed in order to server as a decentralised coin. But today each and everyone is treating as an digital asset. So the keeps on buying and selling the coins which won’t stop and the price will go up like this. Bitcoins cannot be made stable in any way possible. Yes if there was an unlimited supply of the coin, then we could have said things here differently.

I don't think if bitcoin had a larger or unlimited supply it would become stable. Let's take altcoins as an example, ETH also has no fixed supply and its value still increases over time and is also extremely volatile in the short term. The volatility here is simply because everyone sees them as assets for speculation, the buying and selling takes place continuously, thereby creating non-stop fluctuations. It can be said that volatility is the characteristic that makes a difference in the cryptocurrency market

[MFahad]

People focus on Bitcoin investment just because of its volatile characteristic so if it become stabilize then we will not be able to take advantage from it so it will only be used as a source of payment.

USD is a stable currency and it is like by its stability but in a case of bitcoin people hope for the best due to its volatility which cannot be make stable.

 People will not be then interested in the bitcoin investment as there will no such win or loss state of affairs and the money will remains fixed then no one can think that there will be possibility of bitcoin investment.

[GiftedMAN]

People focus on Bitcoin investment just because of its volatile characteristic so if it become stabilize then we will not be able to take advantage from it so it will only be used as a source of payment.

USD is a stable currency and it is like by its stability but in a case of bitcoin people hope for the best due to its volatility which cannot be make stable.

 People will not be then interested in the bitcoin investment as there will no such win or loss state of affairs and the money will remains fixed then no one can think that there will be possibility of bitcoin investment.

Honestly I don't know what op meant by let's stabulize Bitcoin and I hope he understood what that really mean and what it would cause every traders and investors that had been in the market for so long now benefiting from the market. If the price or the momentum of Bitcoin is stabilzed, this will have a great consequences on the Crypto market entirely and everyone will feel the impact or a stagnant market with ranging price of Bitcoin and other cryptocurrencies. Since Bitcoin is a volatile currency not like USDT, busd that are stable coins and are meant to be fixed to USD.

[Ultegra134]

We don't need to.

If you want a coin that's stabilized, use a stable coin. They are stabilized by default.

Bitcoin will never be stabilized against usd because 1 btc = 1 btc. It is the USD that's moving against bitcoin.

Also the investors will lose their interest in btc if they see the same price every day.

Exactly, what's the point of wanting Bitcoin to be stabilized? It makes no sense, as it's more of an asset than a currency nowadays. If someone wants Bitcoin to be stable, then they can resort to stablecoins, which are always pegged to $1, except in rare cases of unusual events that may cause them to depeg from their 1 to 1 parity. Even if we suppose that such a thing were possible, people would simply lose interest because volatility and its immense capabilities are what make Bitcoin a great investment opportunity. It's not like we're not capable of conducting transactions; Bitcoin isn't necessary for that, and there are numerous ways to send and receive money.

[Mauser]

In order for Bitcoin to be widely used for payments, it is necessary to stabilize price fluctuations.

Question,
Bitcoin and other currencies A and Prepare B.
A and B are equivalent exchangeable and can also be equivalently exchanged for Bitcoin.

Is it possible to stabilize prices through market mechanisms due to this?

It would be nice to see a more stable bitcoin market to attract new investors. Unfortunately it  doesn't seem realistic at the moment for the high volatility to disappear. There are so many short term traders in the market these days who would happily take profit after a price jump. That is why we are seeing prices falling again as soon as we are above the 30k level. Theoretically we would need a large institution that owns a lot of bitcoins to actively trade in the market to reduce volatility. Given the nature of a decentralized currency this doesn't seem realistic. Also this could likely lead to big losses, so only a large company or a government could shoulder it. And then there is the halving next year which is going to push prices higher again. As long as investors expect prices to reach the old ATH again there won't be much stabilization of the bitcoin market.

[Outhue]

Sorry to say but I will have avoid Bitcoin if not for it's volatility behaviour, it's the reason why we are all here, Bitcoin doesn't need to be acceptable everywhere, the only thing that's stopping Bitcoin from taking over as means of payment is because of it's decentralized feature, and every other things that we use in the real world for means of payment is all centralized, so tell me, how the hell do you expect Bitcoin to be recognized by the centralized world? It's never going to be easy.

If you are looking for stability on Bitcoin then you lack knowledge about what Bitcoin was built for and why it survived all this while, Bitcoin has died too many times to be worrying about stability in value, hell no,

My advice is DYOR

[Peanutswar]

People focus on Bitcoin investment just because of its volatile characteristic so if it become stabilize then we will not be able to take advantage from it so it will only be used as a source of payment.

USD is a stable currency and it is like by its stability but in a case of bitcoin people hope for the best due to its volatility which cannot be make stable.

 People will not be then interested in the bitcoin investment as there will no such win or loss state of affairs and the money will remains fixed then no one can think that there will be possibility of bitcoin investment.

Honestly I don't know what op meant by let's stabulize Bitcoin and I hope he understood what that really mean and what it would cause every traders and investors that had been in the market for so long now benefiting from the market. If the price or the momentum of Bitcoin is stabilzed, this will have a great consequences on the Crypto market entirely and everyone will feel the impact or a stagnant market with ranging price of Bitcoin and other cryptocurrencies. Since Bitcoin is a volatile currency not like USDT, busd that are stable coins and are meant to be fixed to USD.

People will get less interested in the cryptocurrency if this is stabilized, the market will possible become stabilize in our perspective even though there's a sideways we call this as the center of the support and resistance, people is not active in buying and selling with the market, we recently experience this in this era the price of the bitcoin moves with the 25-30k USD and the investors doesn't want this action or else there's some market manipulation might happen.

[lixer]

The dollar is not a stable, is it?

No, it isn't. You can check currency pairs in Forex trading and see how the dollar fluctuates against other currencies it's paired with.

Is it the dollar that fluctuates against other currencies or is it the other currencies that keep losing and gaining value when paired with the dollar? However, you are right that Bitcoin's stability will most probably make the market become too stagnant and there will barely be people willing to buy or keep Bitcoins then. I know that it offers a lot of use cases and it's not just its value that makes it great, but most people don't see that and they are here just because of the price.

I'm pretty sure that Bitcoin wouldn't have reached this height if it wasn't for the volatility, people started getting interested because they saw it's price going up significantly, and investors started diverting their investments towards Bitcoin for better gains, and that is how it has reached where it is today, make it stable and it goes back to point zero again.

[Blitzboy]

In order for Bitcoin to be widely used for payments, it is necessary to stabilize price fluctuations.

Question,
Bitcoin and other currencies A and Prepare B.
A and B are equivalent exchangeable and can also be equivalently exchanged for Bitcoin.

Is it possible to stabilize prices through market mechanisms due to this?

It would be nice to see a more stable bitcoin market to attract new investors. Unfortunately it  doesn't seem realistic at the moment for the high volatility to disappear. There are so many short term traders in the market these days who would happily take profit after a price jump. That is why we are seeing prices falling again as soon as we are above the 30k level. Theoretically we would need a large institution that owns a lot of bitcoins to actively trade in the market to reduce volatility. Given the nature of a decentralized currency this doesn't seem realistic. Also this could likely lead to big losses, so only a large company or a government could shoulder it. And then there is the halving next year which is going to push prices higher again. As long as investors expect prices to reach the old ATH again there won't be much stabilization of the bitcoin market.

Psychology, economics, and human randomness collide in this game of numbers. Volatility may scare some, but those who prefer risk will be pulled to it like a siren. You suggested a huge bank to stabilise the market. Good idea, but it goes against Bitcoin's decentralisation.

As opposed to previous financial ecosystems, the bitcoin market is alive and dynamic and aims to make finance more accessible. A large firm or government deal may reduce volatility, but it may also increase control and manipulation risks.

You also state "halving" matters. Bitcoin's halving events are natural; they're built in. Their impacts can be roughy estimated and priced. Thus, the question is not only how to stabilise the market but also how to educate potential buyers about these properties and hazards.

[mv1986]

In order for Bitcoin to be widely used for payments, it is necessary to stabilize price fluctuations.

Question,
Bitcoin and other currencies A and Prepare B.
A and B are equivalent exchangeable and can also be equivalently exchanged for Bitcoin.

Is it possible to stabilize prices through market mechanisms due to this?

No, if you want to do something like you proposed, you would actually have to back it with something much bigger than Bitcoin itself and with very low volatility, and you would destroy one of its main features. Anchoring Bitcoin into something that is centralized itself would add an element of centralization to a system that is made to be decentralized and exactly for that reason widely accepted.

Bitcoin's volatility is easily explained. Yes there could also be manipulation at work and that is most likely happening, but for the most part Bitcoin is based on collective trust and expectation. Since Bitcoin doesn't provide dividends like a classic stock, there is also no metric like a P/E ratio or any of those others numbers used to price a stock and make investment decisions accordingly. There is a big number of people who are not doing a lot of research but want to be involved anyway. Those are the people who also are most affected by either FOMO or FUD. They buy when everything seems amazing and they sell on bad news irrespective of the actual impact of those news. High trader sensitivity also leads to high volatility.

But volatility is also attractive to people in general. If it wasn't for Bitcoin's volatility, the global community would probably not be as big as it is. There is an upside and a downside to that.

It would be more important to decrease friction and increase velocity, making Bitcoin a useable currency for everyday transactions in every situation at every time in any place. The Lightning Network would be such a solution, but there is still a lot of work to be done before we'll see higher adoption rates.

[Minecache]

People focus on Bitcoin investment just because of its volatile characteristic so if it become stabilize then we will not be able to take advantage from it so it will only be used as a source of payment.

USD is a stable currency and it is like by its stability but in a case of bitcoin people hope for the best due to its volatility which cannot be make stable.

 People will not be then interested in the bitcoin investment as there will no such win or loss state of affairs and the money will remains fixed then no one can think that there will be possibility of bitcoin investment.

Honestly I don't know what op meant by let's stabulize Bitcoin and I hope he understood what that really mean and what it would cause every traders and investors that had been in the market for so long now benefiting from the market. If the price or the momentum of Bitcoin is stabilzed, this will have a great consequences on the Crypto market entirely and everyone will feel the impact or a stagnant market with ranging price of Bitcoin and other cryptocurrencies. Since Bitcoin is a volatile currency not like USDT, busd that are stable coins and are meant to be fixed to USD.

People will get less interested in the cryptocurrency if this is stabilized, the market will possible become stabilize in our perspective even though there's a sideways we call this as the center of the support and resistance, people is not active in buying and selling with the market, we recently experience this in this era the price of the bitcoin moves with the 25-30k USD and the investors doesn't want this action or else there's some market manipulation might happen.

I also believe that if bitcoin becomes stable it will definitely lose its appeal and people will lose interest in it. Frankly speaking, the decentralized nature is not enough to make people interested in bitcoin as much as it is today, it is the volatility that makes bitcoin attractive and different. Among hundreds of topics and stories about bitcoin, there are 99 stories about bitcoin price and only 1 story about bitcoin decentralization. So it's easy to see what makes people interested in bitcoin. I also never really expected bitcoin to become stable, Bitcoin looks better as a volatile asset than as a stable asset.

[Blitzboy]

In order for Bitcoin to be widely used for payments, it is necessary to stabilize price fluctuations.

Question,
Bitcoin and other currencies A and Prepare B.
A and B are equivalent exchangeable and can also be equivalently exchanged for Bitcoin.

Is it possible to stabilize prices through market mechanisms due to this?

No, if you want to do something like you proposed, you would actually have to back it with something much bigger than Bitcoin itself and with very low volatility, and you would destroy one of its main features. Anchoring Bitcoin into something that is centralized itself would add an element of centralization to a system that is made to be decentralized and exactly for that reason widely accepted.

Bitcoin's volatility is easily explained. Yes there could also be manipulation at work and that is most likely happening, but for the most part Bitcoin is based on collective trust and expectation. Since Bitcoin doesn't provide dividends like a classic stock, there is also no metric like a P/E ratio or any of those others numbers used to price a stock and make investment decisions accordingly. There is a big number of people who are not doing a lot of research but want to be involved anyway. Those are the people who also are most affected by either FOMO or FUD. They buy when everything seems amazing and they sell on bad news irrespective of the actual impact of those news. High trader sensitivity also leads to high volatility.

But volatility is also attractive to people in general. If it wasn't for Bitcoin's volatility, the global community would probably not be as big as it is. There is an upside and a downside to that.

It would be more important to decrease friction and increase velocity, making Bitcoin a useable currency for everyday transactions in every situation at every time in any place. The Lightning Network would be such a solution, but there is still a lot of work to be done before we'll see higher adoption rates.

I agree with you one hundred percent. Bitcoin's foundational feature, decentralization, is also a major reason for the currency's widespread appeal. Adding a centralizing component seems like shoving a square peg into a round hole. This practice contradicts the core principles behind cryptocurrency.

I do find the human psychology aspect of Bitcoin trading fascinating. The market's ups and downs can be directly attributed to the emotions of fear and greed. And certainly, without the usual stock market metrics, traders do need to use more discretion

[MFahad]

Honestly I don't know what op meant by let's stabulize Bitcoin and I hope he understood what that really mean and what it would cause every traders and investors that had been in the market for so long now benefiting from the market. If the price or the momentum of Bitcoin is stabilzed, this will have a great consequences on the Crypto market entirely and everyone will feel the impact or a stagnant market with ranging price of Bitcoin and other cryptocurrencies. Since Bitcoin is a volatile currency not like USDT, busd that are stable coins and are meant to be fixed to USD.

People are benefiting from the cryptocurrency industry because of its unitability and OP is trying to say about stabilize bitcoin to have a constant value of bitcoin which is not easy to occurs and in my opinion it is totally impossible. As the time goes there occurs appreciation in the cost of bitcoin and people select bitcoin when the price depreciation occurs so it cannot get stable.

There are lots of other stable currencies so if one move towards stability then choosing stable currency is a quite good choice but don't think about stability of bitcoin as it is never going to happen.