The volatility of Bitcoin; A merit or Demerit?

[Lida93]

The volatility (persistent changes in the price of Bitcoin) has drawn a lot of attention, and will continue to. The consequences surely has it's merits and demerits; to various users. To the trader, and investor respectively. Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

Least you know, it's the volatility that gives meaning to the coin and why investors sees a need to invest their funds. How do you intend to make profit from bitcoin being a cryptocurrency without volatility?  With the volatility we're provided with couples of opportunities to buy at a good price when it dips, especially for the traders, and if you're a long term investor you have nothing to worry about bitcoin volatility. There's nothing such as demerit outweighing the merit and viz versa.

[viljy]

If we consider bitcoin as a commodity, which it is de facto (now de jure, since all cryptocurrencies are recognized as commodities according to Trump's decree), then volatility is a merit. If we consider bitcoin as a form of money, then volatility makes settlement operations somewhat difficult. In particular, this was one of the reasons for the appearance of stablecoins. Other reasons were the needs of exchange trading, and the need to preserve value (in cryptocurrency form) during bearish cycles.

[bitzizzix]

Volatility is a characteristic of Bitcoin and also offers the best opportunity for profit. This is exploited by traders and long-term investors because it offers the potential for greater profits if you can buy at the right time, buying when the price drops and selling when the price rises. Volatility can also lead to greater losses in a shorter period of time due to its unpredictable nature and inherent risks. Therefore, the best and safest option is to hold Bitcoin for the long term, which will always yield significantly greater profits. You can also take advantage of any dips to continue buying and holding for the long term to achieve greater profits in the future. Thus, volatility can be positive and profitable if managed correctly and effectively, and vice versa.

[john_egbert]

If we consider bitcoin as a commodity, which it is de facto (now de jure, since all cryptocurrencies are recognized as commodities according to Trump's decree), then volatility is a merit. If we consider bitcoin as a form of money, then volatility makes settlement operations somewhat difficult. In particular, this was one of the reasons for the appearance of stablecoins. Other reasons were the needs of exchange trading, and the need to preserve value (in cryptocurrency form) during bearish cycles.

With time, it won't affect BTC that much, even less than it does now, and even more so from the days we already saw.

The turn is now on those to implement the wider adoption for BTC to become that good alternative for fiat money and to be used in that way..

[Moreno233]

The volatility of Bitcoin is neither a merit nor demerit because that is the very nature of every asset that is experiencing huge demand and supply. I don't even know why this is becoming a topic of discussion because it is an inherent property of Bitcoin. Every asset that is driven by the forces of demand and supply will always experience volatility. Take for instance gold and oil, they are both subjected to demand and supply hence they will experience volatility. This means that volatility is not limited to Bitcoin neither can it be used as advantage or disadvantage for Bitcoin.

[_act_]

Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

You can answer the question yourself, just go and check the bitcoin price since chart 2010, that is enough to answer your question.

Not only that, you can also check the first 10 assets of the world in market value. That is also enough to answer your question that bitcoin volatility helped.

But what that helped is bitcoin limited supply and increasing demand.

[melinoe]

Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

You can answer the question yourself, just go and check the bitcoin price since chart 2010, that is enough to answer your question.

Not only that, you can also check the fist 10 assets of the world in market value. That is also enough to answer your question that bitcoin volatile helps.

But what that helped is bitcoin limited supply and increasing demand.

It's a double-edged sword and we shouldn't consider volatility as something completely white or black, more like a gray area, imo, for everybody.

[_act_]

It's a double-edged sword and we shouldn't consider volatility as something completely white or black, more like a gray area, imo, for everybody.

I do not see your post to be necessary at all.

I explained how it is not only about volatility but also how limited bitcoin supply and increasing demand helped. So what are you trying to point out?

Read what people read very well and not just quote someone and post something out of sense.

[melinoe]

It's a double-edged sword and we shouldn't consider volatility as something completely white or black, more like a gray area, imo, for everybody.

I do not see your post to be necessary at all.

I explained how it is not only about volatility but also how limited bitcoin supply and increasing demand helped. So what are you trying to point out?

Read what people read very well and not just quote someone and post something out of sense.

In that case, is the overall market value built more through broader adoption or because the volatility is such a big factor?

It becomes less and less relevant with each cycle going forward, because we don't see BTC drop or rise sharply (like it was before, that is).

Volatility is just the aftermath of being on the market at all..

[leonair]

The volatility (persistent changes in the price of Bitcoin) has drawn a lot of attention, and will continue to. The consequences surely has it's merits and demerits; to various users. To the trader, and investor respectively. Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

Bitcoin is a volatile currency. This is a merit for Bitcoin. Because if it were not volatile, then short-term or long-term investments could not be generated from it. If its price was stable, maybe Bitcoin would not have reached this level today. Why would you buy Bitcoin if you cannot generate profit from it where it is completely decentralized and no one has actually seen who its creator is yet. It is volatile and since Bitcoin came to the market, its price has been increasing in every four-year circle and creating new ATHs, on the other hand, it is going down again and the price is recovering and creating new ATHs. When this circle continues, curiosity about Bitcoin arises among everyone. And from there, Bitcoin is becoming very popular day by day, so I would say that Bitcoin's volatility is definitely a merit.

[hero_the_bossman]

Bitcoin is a volatile currency. This is a merit for Bitcoin. Because if it were not volatile, then short-term or long-term investments could not be generated from it. If its price was stable, maybe Bitcoin would not have reached this level today. Why would you buy Bitcoin if you cannot generate profit from it where it is completely decentralized and no one has actually seen who its creator is yet. It is volatile and since Bitcoin came to the market, its price has been increasing in every four-year circle and creating new ATHs, on the other hand, it is going down again and the price is recovering and creating new ATHs. When this circle continues, curiosity about Bitcoin arises among everyone. And from there, Bitcoin is becoming very popular day by day, so I would say that Bitcoin's volatility is definitely a merit.

You would buy and use BTC for its principles and ideals then, and security too: BTC is not only about the profit, though most see it only through these lenses.

BTC is an alternative to fiat after all, not just a coin to hodl, though it can be done and is a great way to invest, it doesn't push the adoption forward, which, in case, pushes the demand forward..

[X-ray]

The volatility (persistent changes in the price of Bitcoin) has drawn a lot of attention, and will continue to. The consequences surely has it's merits and demerits; to various users. To the trader, and investor respectively. Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

The volatility isn't even that huge, if compared to gold maybe it's more volatile but If I were to use bitcoin for transaction, the few minutes that I needed to send bitcoin won't make the value change that much, probably just pennies.

On the other hand. Without this volatility I doubt the market can become this lively with billions 24h traded every day. It's more of a merit than demerit in my opinion.

I think to some extent that this volatility is what make bitcoin it is today. The 7th highest asset in the world by market capitalization.

[Obari]

The volatility (persistent changes in the price of Bitcoin) has drawn a lot of attention, and will continue to. The consequences surely has it's merits and demerits; to various users. To the trader, and investor respectively. Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

I think one of the major reasons why bitcoin has gained these much of popularity in this shortest prior as compared to other financial instruments is the volatile nature of the coin(my thoughts ) and though, its main purpose was to serve as a decentralized digital currency but at the moment, it’s volatile nature has made holders appreciate it more and prefer to use it as a store of value.
For traders, if bitcoin wasn’t volatile, bitcoin traders wouldn’t have what to trade, hence you would believe me that, the markets of the volatility of bitcoin greatly outweighs its demerits regardless.

Why would you buy Bitcoin if you cannot generate profit from it where it is completely decentralized and no one has actually seen who its creator is yet.

You would buy and use BTC for its principles and ideals then, and security too: BTC is not only about the profit, though most see it only through these lenses.

BTC is an alternative to fiat after all, not just a coin to hodl, though it can be done and is a great way to invest, it doesn't push the adoption forward, which, in case, pushes the demand forward..

In as much as people have seized some great opportunities from the volatility of the coin, that doesn’t change its original purpose, which is serving as an alternative currency to the traditional fiat.

At first, the volatile nature helped drew the attentions of investors, making demand outweighing supply and making the price of bitcoin skyrocket but now, I think the skyrocketed price is no longer pushing for adoption as people now think, the coin is too expensive to own(except for those who have the knowledge of DCA)

[BitGoba]

The volatility (persistent changes in the price of Bitcoin) has drawn a lot of attention, and will continue to. The consequences surely has it's merits and demerits; to various users. To the trader, and investor respectively. Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

Bitcoin is a decentralized monetary protocol and money. Money has only three uses a medium of exchange, a store of value, and a unit of account. These are the only three uses of money, and Bitcoin can be used for all of them.However, many people do not understand Bitcoin and treat it as a speculative asset instead of a superior form of money suitable for long-term savings.
The advantage is that you can buy cheaply when many dumb investors are selling. It’s true that volatility scares many normies, but once they realize that Bitcoin only grows, and when it surpasses one million dollars, the volatility will decrease and more normies will start using Bitcoin.

[btc_angela]

The volatility of Bitcoin is neither a merit nor demerit because that is the very nature of every asset that is experiencing huge demand and supply. I don't even know why this is becoming a topic of discussion because it is an inherent property of Bitcoin. Every asset that is driven by the forces of demand and supply will always experience volatility. Take for instance gold and oil, they are both subjected to demand and supply hence they will experience volatility. This means that volatility is not limited to Bitcoin neither can it be used as advantage or disadvantage for Bitcoin.

Yeah, but Bitcoin is very different from those class assets, Bitcoin's volatility is not something that we have seen from those. And that's why it remain to be a hot topic as this is also one point that those against Bitcoin are pointing out.

But maybe in the near future is won't be as volatile as we have seen today. Perhaps when we reaches that almost all Bitcoin has been mined, it could be that the price could go a stable flatline as the 1% won't be mind for the next 100 years or so.

[Kryss191]

It’s a double-edged sword. Traders and speculators benefit from the constant price action, but for mass adoption (like payments or savings), volatility is a barrier. Less volatility would probably mean less hype short-term, but more institutional and everyday usage long-term

[Rockstarguy]

The volatility (persistent changes in the price of Bitcoin) has drawn a lot of attention, and will continue to. The consequences surely has it's merits and demerits; to various users. To the trader, and investor respectively. Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

The volatility of Bitcoin is a good advantage for Bitcoin because the volatility is what makes it valuable; the volatility brings value. To some people, the volatility might have caused them to lose, but this is just because they don't understand Bitcoin very well. If the volatility of Bitcoin were otherwise, Bitcoin would be considered to be the same as fiat. Bitcoin has rich volatility that you can't even find in other assets.

Only those who don't understand Bitcoin will see volatility as a threat because they have a different understanding of Bitcoin volatility, and this is what causes them to lose.

[free-bit.co.in]

The volatility of Bitcoin is neither a merit nor demerit because that is the very nature of every asset that is experiencing huge demand and supply. I don't even know why this is becoming a topic of discussion because it is an inherent property of Bitcoin. Every asset that is driven by the forces of demand and supply will always experience volatility. Take for instance gold and oil, they are both subjected to demand and supply hence they will experience volatility. This means that volatility is not limited to Bitcoin neither can it be used as advantage or disadvantage for Bitcoin.

But you can't deny that bitcoin's volatility is significantly greater than gold, oil, or any traditional asset. It can be said that no traditional asset is as volatile as bitcoin and that brings both advantages and disadvantages to bitcoin. Not everyone likes high volatility, roller coaster rides and that is one of the reasons why many investors are still hesitant and have not invested in bitcoin. Or as some have pointed out, with such high volatility, using bitcoin as a currency is very inconvenient and no one wants to use such a volatile currency.

[fikrett]

The volatility of Bitcoin is neither a merit nor demerit because that is the very nature of every asset that is experiencing huge demand and supply. I don't even know why this is becoming a topic of discussion because it is an inherent property of Bitcoin. Every asset that is driven by the forces of demand and supply will always experience volatility. Take for instance gold and oil, they are both subjected to demand and supply hence they will experience volatility. This means that volatility is not limited to Bitcoin neither can it be used as advantage or disadvantage for Bitcoin.

But you can't deny that bitcoin's volatility is significantly greater than gold, oil, or any traditional asset. It can be said that no traditional asset is as volatile as bitcoin and that brings both advantages and disadvantages to bitcoin. Not everyone likes high volatility, roller coaster rides and that is one of the reasons why many investors are still hesitant and have not invested in bitcoin. Or as some have pointed out, with such high volatility, using bitcoin as a currency is very inconvenient and no one wants to use such a volatile currency.

It will change eventually to the times where BTC would be much more less volatile to be used such a currency, imo, it all comes to such a way of things, because demand for BTC rises, and so rises the power needed to turn its price somewhere.

[Beparanf]

The volatility (persistent changes in the price of Bitcoin) has drawn a lot of attention, and will continue to. The consequences surely has it's merits and demerits; to various users. To the trader, and investor respectively. Do the merits outweigh the demerits? Would a less volatile nature draw more usage?

It depends on the user that will view it because we have different preferences on how we can handle volatility.

As a Bitcoin holder, that volatility is not a big deal since I focus on the longer timeframe so there’s no demerit effect for me regardless if the price swing is so strong.

But for futures trader, the result will be significant depending on their current PnL by trading Bitcoin with this volatility.