13:00 ▪
3
min reading ▪ by
Eddy S.
The realized volatility of Bitcoin (BTC) has declined steadily since the pandemic, creating challenges for retail speculators. With decreasing volatility, the chances of earning high returns from short-term trading decrease. For individual traders, these changes in market behavior are a real nuisance.
Falling Bitcoin Volatility: A Challenge for Individual Traders
The low volatility and current stability of Bitcoin reduces opportunities for quick profits for individual traders. In effect, these market conditions limit the price fluctuations necessary for significant short-term gains, making trading less lucrative for retail speculators who depend on larger price movements.
However, large companies and government entities perceive the situation differently. According to Axel Adler Jr., these institutions are favored by the stabilization of the level of volatility. Companies are now investing in Bitcoin to protect themselves against conventional assets. Even governments are considering using it as a value preservation tool against inflation.
With the reduction in volatility, the use of Bitcoin is increasing among these entities, which are able to absorb price volatility. This new market environment is causing changes in the perception of Bitcoin. As retail speculators fail to achieve the desired volatility, institutional investors discover new opportunities.
New dynamics of BTC: stability and long-term investment
This market development is beneficial for large companies and governments, who see the stability of Bitcoin as a long-term investment opportunity. On the other hand, individual traders, who depend on volatility to make quick profits, find this situation less favorable.
In short, the decline in Bitcoin volatility limits short-term trading profits for retail speculators, but opens new prospects for institutional investors. This dynamic could transform the way BTC is perceived and used in the future, consolidating its status as an asset class in its own right.
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Eddy S.
The world is evolving and adaptation is the best weapon to survive in this undulating universe. Originally a crypto community manager, I am interested in everything that directly or indirectly relates to blockchain and its derivatives. In order to share my experience and raise awareness of a field that fascinates me, there is nothing better than writing articles that are informative and relaxed at the same time.
DISCLAIMER
The comments and opinions expressed in this article are those of the author alone, and should not be considered investment advice. Do your own research before making any investment decisions.
