The world’s largest cryptocurrency has been trading in a tight range of $732 since September 7th. Volatility is currently sitting at its 17-month low, causing some experts to believe that Bitcoin is not as exciting, while others hold that it’s a sign that the market is maturing.
‘Not As Exciting’
Bitcoin captured the world’s attention in late 2017, surging to an all-time high (ATH) of around $20,000. 2018, however, marked the turning of the tides. Since its ATH value, BTC has lost over 60 percent and is currently trading at $6,610.03, according to CoinMarketCap. The entire cryptocurrency market saw around $600 billion wiped off the sheets.
What is more, what seemed like a normal day of Bitcoin trading marking 15 percent movement in either direction is no more. The cryptocurrency has traded in a rather tight $732 range since September 7th, which is the narrowest trading band for any consecutive 28-day period ever since December 2016, Bloomberg reports.
Some experts like Stephen Innes, head of Asia Pacific trading at Oanda Corp, believe that this is a signal that investors may be losing interest. He said:
It’s not that exciting anymore.
Other industry experts also seem to share the sentiment that volatility is actually a good thing for Bitcoin. Earlier this year, the co-founder of cryptocurrency exchange BitMEX, Arthur Hayes, noted:
You want as much volatility as possible to have as much chance that Bitcoin goes to $50,000, $100,000, $1,000,000, whatever that high number is.
Signs of a Maturing Market
Others, however, are on the opposite side, outlining that the decrease in volatility and the relative stability in Bitcoin’s price are a sign that speculative money is going away and that the market is maturing.
Speaking on the matter was Mike McGlone, Bloomberg Intelligence strategist, who noted:
This is a maturing market, so volatility should continue to decline. […] When you have a new market, it will be highly volatile until it establishes itself. There are more participants, more derivatives, more ways of trading, hedging and arbitraging.
Nigel Green, founder of DeVere Group, also shared a similar sentiment:
This could be a signal that the cryptocurrency market is maturing.
No matter what, financial analysts can always look at the exact same thing and come to different conclusions. Volatility is exciting, but usually only if the value is going up. Downward volatility always brought calls of the impending end of the world’s foremost cryptocurrency. It could also be that the current stability may only be fleeting. It’ll be interesting to see what will happen with Bitcoin for the remainder of 2018.
Do you think Bitcoin is getting boring? Or is this a sign of a truly maturing market? Let us know in the comments below!
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