The bitcoin (BTC) price is known for its volatility. The price is shooting back and forth by tens of percent on some days. That is sometimes seen as a disadvantage, but the emergence of a new currency like this does not go a straight line.
This goes with bumps and bruises, with dips and with high peaks. Price volatility is at its highest point since the crash on March 12. The price then plunged below the $4,000 mark.
Uncertainty
The violent rises and falls undoubtedly deter a number of people. That doesn't apply to larger investors and bitcoin whales. In these tumultuous times, the number of addresses by more than 1,000 BTC is steadilygrowing . Wealthier investors are therefore not deterred and even increase their position.
According to data from Skew, the bitcoin price is currently the most unsettled since the big crash in March 2020. Almost all markets in the world were impressed by the news about COVID-19.
The analysts look at 'realized volatility', for which they use a period of 30 days with the average fluctuation of the price. In the past month, the bitcoin price has been down 103% from the average price.
One of the moments you can point to for this high percentage is January 11th. The bitcoin price stood at $42,000 in the weeks before, but dived within 24 hours to prices around $30,000. Big declines are not new in btc's world, but it often creates a shock wave in the market: some investors start to doubt.
During bull runs, price fluctuations are higher than in times of negative market sentiment.
Security
Bitcoin has the name of an insecure investment product. But nothing is worth less. It is just everything around bitcoin that is or may be relatively chaotic and uncertain. With bitcoin, you know a number of things for sure.
So you can assume that the money you have is yours, as long as you take good care of it, no one can take it away. In addition, there is a fixed number of bitcoin: 21 million maximum.. Even that issue can be mapped and you can build on it. There will never be a whole mountain of new BTC.
Secretly, bitcoin offers more security than many other investments, despite volatility in dollars or euros.