While crypto’s famed volatility can be terrifying for investors, it is something that needs to be weathered.
Part of what has cemented cryptocurrencies on the map since they exploded into the mainstream investor market has been their volatility. Investors flooded to the likes of Bitcoin when, through November and December 2018, the value of the cryptocurrency increased in value exponentially.
The cryptocurrency market has also felt the ill effects of Bitcoin’s volatility because as a result of the price drops, Bitcoin’s trading volume, and even interest in the digital currency realm also decreases. The danger is that volatility can cause a large exodus of investors to occur which severely dents the hopes of other cryptocurrencies gaining mass adoption status.
Volatility should be at the center of attention if there is to be a future in which crypto is used widely in day-to-day instances.
However, it requires a lot of bravery, and some tactical know-how, to successfully navigate the lows, in order to keep oneself safe, and sane, as well as contribute positively to a burgeoning crypto economy.
Why volatility is important, but deadly
There is a lot to be said for the role that volatility played in helping cryptocurrencies reach the mainstream market.
Cryptocurrencies, and Bitcoin in particular, only made it into the mainstream media stream as a tool of the dark web when the infamous Silk Road was shut down. Back then, it was far from being considered a good investment for Wall Street types, but they soon joined the party.
Suddenly, banks, the thought leaders of banking and financial institutions all had an opinion on Bitcoin – many of them thought it was a fad, or even rat poison and far too volatile to take seriously, but conversations about Bitcoin were starting to be held in investment