- Bitcoin has been plagued by extreme volatility.
- European COO of exchange BitFlyer says big moves down to the relative size of bitcoin market compared to other assets.
- Foreign exchange is like an “oil tanker on the open sea,” while “bitcoin, relatively speaking, is like a dinghy.”
- Expects volatility to decline as the cryptocurrency grows.
LONDON — Why is bitcoin so volatile?
It fell back from its highs and a cryptocurrency “bloodbath” in recent weeks has seen it fall back to around $10,000. Moves of 5% or even 10% on a day are not unusual.
Critics claim that the currencies extreme volatility make it not fit for purpose as a method of exchange and some retailers have in fact stopped accepting it as a result.
But Andy Bryant, the European COO of bitcoin exchange BitFlyer, says that the current volatility is simply a symptom of bitcoin’s evolution and will not be a permanent feature.
“Of course, objectively, bitcoin is volatile,” Bryant told Business Insider. “But when I talk about volatility I like to zoom out a bit and take a step back. Bitcoin as an asset class is still only, give or take, $200 billion. Cryptocurrency as a whole, including bitcoin, is $600 billion.”
“If you look at just one company, Apple, they’re $900 billion. Bitcoin is less than a quarter of an Apple. It’s only two Warren Buffets.
“You could keep going — look at the global gold market, $8 trillion; global stock markets are $75 trillion; global currency markets $90 trillion; real estate is $200 trillion, that’s already 1,000 times bitcoin’s market Read More Here