The largest cryptocurrency by market capitalization is considered extremely volatile in the traditional financial world. With price jumps of over ten percent every day – up and down – Bitcoin is an investment for risk-taking investors. At least that is the opinion of some critics.
Compared to the crypto market, Bitcoin’s price fluctuations are negligible; the crypto reserve currency is considered to have relatively stable value. After all, significantly more capital is needed to influence the market capitalization of the ninth most valuable asset in the world. However, due to the Bitcoin Spot ETFs approved in January, there is this capital inflow or outflow: Bitcoin is now more volatile than Ethereum.
Volatility: Bitcoin overtakes Ethereum
Bitcoin’s annualized historical or realized 30-day volatility rose to nearly 60 percent at the end of last week, surpassing Ether’s 30-day volatility by almost 10 percentage points. This is what data from Kaiko shows.
At the time of writing, BTC and ETH are balanced: both cryptocurrencies have fallen by almost five percent in the last 24 hours. Bitcoin is trading at $66,535 and Ethereum at $3,349. The total market capitalization is $2.5 trillion.
Increasing volatility before the halving?
According to Amberdata’s Director of Derivatives, Greg Magadini, there will be increasing volatility after the halving – due to a price correction. Because: The halving will become a “sell-the-news” event, said Magadini in one Newsletter.
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The ETC Group’s Head of Research, André Dragosch, also agrees. But: In the long term, the Bitcoin price is expected to rise due to the halving of supply. The ETC Group research team has made this finding in one Thesis paper determined. “The results indicate that the Bitcoin Halving will initially be a non-event and will only become significant about 100 days later,” they concluded.
You can find everything about the upcoming halving – expected on April 21, 2024 – here: Bitcoin Halving 2024: Everything you need to know
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