Will the bitcoin volatilities keep falling in the future?

[suzanne5223]

Does that mean that at some point in the future, bitcoin's volatilities could decrease?

The 3 things that always change the volatility of every asset, or commodity, are bigger market cap size, institutional accumulation, and mainstream adoption are things that have already happened to Bitcoin, which is why we see the change in the nature of BTC volatility through the change. I believe we already have the answer to your question if BTC volatility will keep falling in the future.

[legiteum]

Does that mean that at some point in the future, bitcoin's volatilities could decrease?

The 3 things that always change the volatility of every asset, or commodity, are bigger market cap size, institutional accumulation, and mainstream adoption are things that have already happened to Bitcoin, which is why we see the change in the nature of BTC volatility through the change. I believe we already have the answer to your question if BTC volatility will keep falling in the future.

Gold has been around for over 6,000 years and it's still too volatile to be used for ordinary business planning.

So there's that...

[Gozie51]

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Does that mean that at some point in the future, bitcoin's volatilities could decrease?

I think so but not because bitcoin will lose its purpose but because institutions will hodl more bitcoin than individuals and that will reduce demand and supply volume. Volatility is as a result of volume of trade and when the growth rate recorded becomes reduced, it may reduce volatility. Also, it may reduce especially in bear season because bitcoiners are now having better understanding of when best to invest in bitcoin. They wait for the time nearing halving so that their investment can speedily increase in a short time preceding the bull. So these factors may temporarily reduce volatility but not that government will control it or that the purpose of bitcoin as a decentralized digital currency has shifted.

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I'm not saying it will become completely stable, but is there a possibility of gold-like types of volatilities?

IMO, no. Gold is natural resources and regulated by government but Bitcoin is not a natural resources and is not regulated by government. Bitcoin is not a natural resource. Bitcon is innovated by human as decentralized digital currency through computer cryptographic coding, so it is independent of nature and can't be manipulated by nature. The volatility of bitcoin is strictly based on its limited supply and demand.

[Zaguru12]

Gold has been around for over 6,000 years and it's still too volatile to be used for ordinary business planning.

While gold is definitely volatile but it’s not that volatile like other assets or coins like bitcoin. But that aside I think Gold is not been used as a currency for business more frequently because investors actually just treat it as a scarce asset meant for holding rather than using it as a mere currency when they can easily use fiat for that. It’s like someone using is land to pay for something that he has fiat which can cover for it. This is also the perception that some people use for bitcoin too.

[aoluain]

Gold has been around for over 6,000 years and it's still too volatile to be used for ordinary business planning.

While gold is definitely volatile but it’s not that volatile like other assets or coins like bitcoin. But that aside I think Gold is not been used as a currency for business more frequently because investors actually just treat it as a scarce asset meant for holding rather than using it as a mere currency when they can easily use fiat for that. It’s like someone using is land to pay for something that he has fiat which can cover for it. This is also the perception that some people use for bitcoin too.

There is usually a big hoodoo if the Gold market suddenly moves like 5% in a day whereas
the Bitcoin market can do that numerous times a week regularly!

There is definitely an argument for the Bitcoin market to get less and less volatile with each
passing halving event. More Bitcoin reward, more adoption, more understanding of the market
itself should/can/will lead to less volatility. I believe the volatility will always be a factor
because the market is accessible to everyone 24/7/365.

[famososMuertos]

The reality is that bitcoin's organic volatility(1) has been evolving over the years, mainly because of the participants involved. In its early days, it was driven almost entirely by retail investors (Ordinary people: Tu-Yo  ) and that remained the case for many years.

Over time, new factors emerged that weren't part of Bitcoin's organic  volatility (1:or native market volatility) at first but were instead external forces acting on the market. Today, many of those same forces have become part of that organic volatility. Institutional investors are a good example, as is the traditional financial establishment, which once viewed Bitcoin with suspicion but is now an active participant. Retail investors still play an important role, but in my opinion, bitcoin's volatility is gradually becoming institutionalized.

If that trend continues, I believe bitcoin will eventually see a decline in the steepness of its roughly "45-degree" growth curve over the long term. That would mark what I consider the first step toward a more mature market.

The real question, as always, is "when" that transition will happen. If, ten years from now,bitcoin is still trading somewhere in the $60k-$70k range, then perhaps that first step will already have taken place.

[Alphakilo]

Gold has been around for over 6,000 years and it's still too volatile to be used for ordinary business planning.

While gold is definitely volatile but it’s not that volatile like other assets or coins like bitcoin. But that aside I think Gold is not been used as a currency for business more frequently because investors actually just treat it as a scarce asset meant for holding rather than using it as a mere currency when they can easily use fiat for that. It’s like someone using is land to pay for something that he has fiat which can cover for it. This is also the perception that some people use for bitcoin too.

There is usually a big hoodoo if the Gold market suddenly moves like 5% in a day whereas
the Bitcoin market can do that numerous times a week regularly!

There is definitely an argument for the Bitcoin market to get less and less volatile with each
passing halving event. More Bitcoin reward, more adoption, more understanding of the market
itself should/can/will lead to less volatility. I believe the volatility will always be a factor
because the market is accessible to everyone 24/7/365.

There has been so much advancement as surrounding the Bitcoin ecosystem that makes it plausible to say that Bitcoin as an asset can transition from a speculative asset that is plaqued by volatilities into a major financial instrument that sees less volatility with current happenings and policies surrounding it.
Bitcoin could become steadier as gold is or with little volatility because it has and is still evolving by the day to meet several demands and regulations.

[alastantiger]

I used to think that as an asset's market capitalisation gets larger, it gets less volatile and maybe in the market of the past (let's say pre-2020) it was the truth, but now we see increased volatility among all liquid asset classes and all capitalisation. When SpaceX, Gold and other trillion-dollar assets are traded like shitcoins, it doesn't really have much sense to expect a historically volatile and speculative asset to become significantly less volatile even with the valuations growth.

The market is different now and as such thing's would not be as it used to be in the past that we can have stable assets being stable for a long period. Right now the world the is watching every move the assets shows  and of the CEO hence the market is more volatile now and with Bitcoin I think the same is going to continue happening. We have more active investors in this period that is why it is looking different from how the market use to be but the market would not start to reward the new type of investors instead it will continuously to give big profits to those that hold instead of panicking for how volatile the market is.

[d5000]

Does that mean that at some point in the future, bitcoin's volatilities could decrease?

It is decreasing, not only regarding the absolute amplitude between ATHs and ATLs (bull market tops and bear market bottoms) but also regarding the average day-to-day volatility.

You can see more details in this thread: We're experiencing the least volatile bear market ever.

I'm not saying it will become completely stable, but is there a possibility of gold-like types of volatilities?

Here's an updated chart of 30-day and 60-day average daily volatility for Bitcoin:


Source: https://bitbo.io/volatility/

They used to provide also the volatility indicator for gold. Unfortunately, they ceased to do so, and I didn't find an alternative source for exactly the same indicator (there are many).

Historically however I have noticed that the volatility for the Brazilian Real (BRL, which is provided in the chart as the orange line) was similar to gold's , with values between 0.5 and 1%.

Bitcoin is the yellow line and currently at 1.26%. We can say that Bitcoin has, currently, approximately two times the day-to-day volatility in comparison to gold's historic values, because it often increases up into the 2% range.

In general, I think in the next early bull cycle I'd expect volatility values as low as gold, if no Black Swan (negative or positive) happens. At least if you draw a straight line alongside the current volatility average, it would cross the 1% line in a few years. See this older image where you still can see the gold value (yellow, although it only was updated until early 2024 (so the 0.00 value you see for 2026 isn't correct -- Bitcoin is light orange in this chart, and the volatility trend is the blue line):



(You can also see in this chart there that the BRL -- red line here -- has indeed similar values than gold, see above.)

[MiF]

I used to think that as an asset's market capitalisation gets larger, it gets less volatile and maybe in the market of the past (let's say pre-2020) it was the truth, but now we see increased volatility among all liquid asset classes and all capitalisation. When SpaceX, Gold and other trillion-dollar assets are traded like shitcoins, it doesn't really have much sense to expect a historically volatile and speculative asset to become significantly less volatile even with the valuations growth.

The market is different now and as such thing's would not be as it used to be in the past that we can have stable assets being stable for a long period. Right now the world the is watching every move the assets shows  and of the CEO hence the market is more volatile now and with Bitcoin I think the same is going to continue happening. We have more active investors in this period that is why it is looking different from how the market use to be but the market would not start to reward the new type of investors instead it will continuously to give big profits to those that hold instead of panicking for how volatile the market is.

I believe that Bitcoin's volatility won't go away any time soon, but will slowly diminish as more people use it. Note that lower volatility does not indicate low volatility. Bitcoin is a very young asset, and significant price movements can be caused by major news events, institutional actions, and macroeconomic shifts. But the percentage changes were not as dramatic compared to its early years. The long-term investors are still the top beneficiaries as they're aware that price volatility is a natural part of the process while knowing that Bitcoin will ultimately move in the opposite direction. Panicking during corrections will result in selling to the patient investors who are able to play the game through the cycles.

[MainIbem]

A chart similar to that of gold is possible in the future, but I'm of the opinion that we should be moving away from the comparisons to gold, bitcoin is not looking to replace it or be the digital version.

I don’t know why people wants not just to compare Bitcoin with gold but want to see the difference gap bridged and bitcoin becomes so alike to Gold.
Personally bitcoin volatility is something I value, I don’t think I want to see bitcoin becomes so stable that we don’t see any movement in the market.
Will the volatility keep falling? I don’t predict so because there have been less factors to prompt a crash or surge lately Thats why it seems the volatility is decreasing.

If you look at that image the bullish and bearish trends of volatility are gradually reducing as the year goes and that's a similar thing gold did years back which is why he feels Bitcoin could do something similar since it's already following such trend. Bitcoin was never meant to be stable, else the coin won't rely on demand and supply factor. In the future Bitcoin would likely experience a gold trend volatility when the market cap increase, for now there are more retails than ETF's but when more nations, institutions and ETF's step in then the possibility of getting a goldlike volatility would be reality.

[LUCKMCFLY]

While gold is definitely volatile but it’s not that volatile like other assets or coins like bitcoin. But that aside I think Gold is not been used as a currency for business more frequently because investors actually just treat it as a scarce asset meant for holding rather than using it as a mere currency when they can easily use fiat for that. It’s like someone using is land to pay for something that he has fiat which can cover for it. This is also the perception that some people use for bitcoin too.

It's undeniable that gold has enjoyed incredible success since the beginning of time, but now Bitcoin is the stock/currency of the future, not just for the next generation, but for everyone.

Those economists who still don't recognize Bitcoin's fundamental value as they do gold shouldn't be taken too seriously.

While many project that Bitcoin's inherent volatility will decrease in the future, which is acceptable (according to some studies/speculative projections based on fundamentals that can be quickly invalidated), it's crucial to consider that all speculative markets are governed by emotions, institutional investments, and private investors, not by probabilities, mathematics, or, much less, technical analysis, which is easily invalidated if a fundamental event occurs in the world.

Therefore, Bitcoin doesn't need government or physical backing, as it is governed by supply and demand. Furthermore, Bitcoin's intrinsic value is much greater than what we currently perceive relative to the US dollar. We cannot forget all the detractors and enemies Bitcoin has worldwide, who constantly attack it through the media, fake news, and other methods.

The best thing about the BTC market is its volatility; what might be unattractive to some? Unconsolidated volume, a metric not everyone understands and which they lack, since it requires a large number of servers to record transactions made on the dark web, on some unlicensed exchanges that may operate However, even though CMC, Binance, and Bitfinex don't record these generally small volumes, they are fueled by the REAL liquidity of BTC.

[bangjoe]

If I am not wrong, most of us have this kind of discussion about what the next season or future price of Bitcoin will be.

However, the question arises in my mind that do we ever discuss the changing nature of the volatility of Bitcoin?

I think it's important not to get too carried away with this, because if we look at the early volatilities of Bitcoin and look at the current volatilities, there's definitely a big difference. For example, if you look at the picture below, you can see that the percentage of Bitcoin's bear bottom price dumping has been decreasing consistently in each bear season.

And the same thing is happening in the bull season when it comes to creating all-time high prices.

Does that mean that at some point in the future, bitcoin's volatilities could decrease?

I'm not saying it will become completely stable, but is there a possibility of gold-like types of volatilities?

I look at it from a different angle but the conclusion is the same, as time goes by that Bitcoin becomes an attraction for anyone to buy and make an asset in his life will make bitcoin busty on the value that will be increasingly difficult to push to experience high increases, this is a form of adoption force.
But seeing the adoption and money that goes into Bitcoin is not yet like when looking at other assets that are very common among the community, so the upside potential is still quite large and although volatility will slowly decrease, my conclusion is that in the current cycles it is still quite possible to get big profits if you buy at a DIP price and a fairly steep decline after printing a new ATH, until in the end between the DIP price and the ATH price in a cycle the distance is getting closer.

You can also see the bitcoin daa with this chart.


Here it also shows that bitcoin is falling more and more volatility, and in the future it will also be like that, do not be surprised at such a situation, but what is certain from all the talk about bitcoin volatility is that Bitcoin will remain a powerful tool to fight inflation.