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by adrianveidt 3151 days ago
How would volatility decrease in case of mass adoption?
1 comments

When Bitcoin was $10 a $1 move in price was a 10% change.

When Bitcoin was $100 then a $1 move in price was a 1% change.

When Bitcoin was $1000 then a $1 move in price was a 0.1% change.

If Bitcoin gets mass adoption then the price per Bitcoin could be $50,000 (assume $1 trillion market cap) or higher. At that point a $1 market movement would be a 0.002% change. To get the same 10% movement as at $100 would require a $5,000 market price swing which while possible is less likely.

It means a lot more money would have to be bought or sold to cause the same percent movement in price.

Bitcoin is already much less volatile today than it was in the past.

> If Bitcoin gets mass adoption

That a big IF. And with the transaction costs it has, I don't see it getting mass adoption any time soon.

yeah, but why is $5,000 less likely. Is there some fundamental reason?