Bitcoin Becoming Less Volatile Than Stocks Raises Warning Flag
At first blush,
$Bitcoin (BTC.CC)$ becoming less volatile than stocks might appear like a positive development. But crypto traders are warning that in a low-volume environment, that might not be a great thing.
Yet trading volume has also slumped. Daily readings are hovering around $47 billion right now, down from more than $100 billion at the start of the year, according to data tracker CoinMarketCap.com.
And even though lower volatility is typically welcomed in the stock market, for instance, the combo could spell trouble for Bitcoin, where there tend to be plenty of speculators who enter the space purely for the thrill of the swings.
Crypto has suffered this year as the Federal Reserve and other central banks aggressively raise rates to cool inflation. That’s pushed a lot of digital-asset investors -- especially those who had gotten in just over the last few years -- away from the space and from daily trading, a big change from the hype-fueled mania of years past. Retail investors, in particular, have been missing in action. Meanwhile, institutions have become the main players recently, potentially helping to explain why volatility has declined.
$Ethereum (ETH.CC)$ $Cardano (ADA.CC)$ $EOS (EOS.CC)$ $Dogecoin (DOGE.CC)$ $Coinbase (COIN.US)$
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