The price volatility of Bitcoin has been decreasing continuously. And JP Morgan says this is coming under institutional notice. There is a good chance that more companies and banks could join in and invest further in Bitcoin. Things are looking pretty good right now and are bound to get better with time. Analysis suggests that the volatility of BTC has decreased drastically over the years, and as the prices rise further, the volatility will drop even more. Just an example of this was when BTC wasn’t able to cross $60k but held on between $59k-$60k pretty strong.
Decreasing price swings of Bitcoin
The decreasing price swings are the consequence of the lowering volatility of Bitcoin. This is good and weird as a few months back, BTC was considered very volatile, and now suddenly, that’s changed. Well, not completely, it is nothing close to Fiat or stable coins, but yes, still, a strong buying force has managed to keep things balanced. Reports also suggest that the number of holders is increasing with time, and even mining companies are not selling. At the same time, big companies like Tesla, Square, Microstrategy buying in are increasing the price of Bitcoin while decreasing its volatility.
This is no joke, as we all know that one of the biggest downsides of Bitcoin was its fluctuations. It was considered as one of the most volatile assets globally. People looked towards it with skepticism, and big banks stayed miles away from including it into their offerings. But that has changed as now even banks are looking at it as a good offering for their clients. And even though they are limiting it to the rich ones, at least the option is there.
Another important upside to this is using BTC as a currency. Analysts have often said that the volatility of BTC makes it incredibly difficult to recommend using it as a currency. This is also the reason that Mastercard plans on using stablecoins when they add crypto support to their payment methods. But with dropping volatility, the idea of using Bitcoin as a payment option is quite logical. These lowering price swings could also bring in a lot more investments from companies who initially shied away from the idea.
Yes, this is a good chance for Bitcoin to replace gold as the most valuable asset globally. It is still far behind in terms of market cap and even volatility but sure we are much ahead of where we started. Even the Federal Reserve chairman said that Bitcoin could not be a replacement to fiat but definitely to gold. And with the decreasing price things both of the things could happen here.
What do you think about the decreasing volatility of Bitcoin? And does this mean it could replace gold and fiat? Let us know in the comments below. Also, if you found our content informative do like it and share it with your friends.