Bitcoin suffered some price drops last year. After a rapid rise in the middle of the year, the price slipped again just as quickly. However, bitcoin has always had the most stable price development, an analytics company found.
Exchange rate fluctuations in Bitcoin are as safe as amen in the church. What risk-loving investors appreciate is deterring conservative investors from investing in the cryptocurrency. The analysis company San Francisco Open Exchange (SFOX) has now examined the performance of the most prominent cryptocurrency. The result may surprise some: Bitcoin had the lowest volatility since the beginning of 2009 – 32.05 percent last year. If this trend is confirmed this year, Bitcoin could dampen the gamblers’ mood on the one hand, but at the same time achieve the status of a safe financial investment.
The Bitcoin ecosystem is maturing
In the heyday, many wanted a piece of the supposedly growing Bitcoin cake. It is therefore hardly surprising that public interest dwindled when the course dived in late 2017 and plummeted from nearly $ 20,000 to $ 3,400 in the late 2018. The ascent and descent for many – apart from nerves – may have cost money.
The fact that Bitcoin has always had the smallest price fluctuations in 2019 could therefore be a valid argument for traditionally tuned investors to extend their feelers towards the “digital gold”. In addition, balanced exchange rate fluctuations could turn Bitcoin from a plaything of speculation to a stable investment in the future. Bitcoin could also establish itself as a crisis currency if the value remains reasonably stable.
Course development 2019
In early 2019, traders were able to buy 1 BTC for around $ 3,710. Over the next six months, the price peaked at $ 12,703 on June 26, an increase of 242 percent since the beginning of the year. Since then, the BTC rate has been falling steadily, leveling off at around $ 7,000 at the end of 2019.
If you look at the historical 30-day volatilities of Bitcoin and altcoins such as Ether and Litecoin, you can see that the general crypto-volatility decreased in early 2019, rose in the middle of the year and decreased again towards the end of the year. Bitcoin volatility started at 70.21 percent in 2019, dropped to 17.86 percent by April 1, climbed to 102.53 percent by July 20, and dropped to 32.05 percent by the end of December.
Bitcoin showed impressive yields of 93.8 percent in 2019 compared to the 29 percent of the S&P 500 and even the strong 52.8 percent for gold. But while the lower volatility indicates a gradual increase in market maturity, the risk is still much higher compared to the profits. The SFOX also found a low correlation with the S&P 500 and gold.