Volatility: What it means and why people talk about it
Bitcoin is known for being volatile.
That means its price can change a lot — sometimes by thousands of dollars in just a few days.
But volatility isn’t always bad — it’s just something you need to understand.
What exactly is volatility?
Volatility refers to how much and how quickly an asset’s price moves over time.
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High volatility = big price swings (up or down)
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Low volatility = small, slow, or steady price changes
Examples: Comparing asset volatility
High volatility
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Bitcoin: can gain or lose several percent in a day
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Tech stocks: like Tesla or Nvidia often show large price swings
Medium volatility
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Gold: changes in price are slower and more predictable
Low volatility
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Real estate: prices move gradually
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Government bonds: often very stable
What about currencies like the peso or the dollar?
You might think cash is stable — but over time, it quietly loses value due to inflation.
For example:
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In the last 50 years, the Colombian peso lost about 99.9% of its purchasing power
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In the same period, the U.S. dollar lost about 85–90%
So even though these currencies don’t swing wildly day to day, they slowly erode your savings.
So is volatility bad?
Not necessarily.
Volatility is just movement. It can be scary, but it can also create opportunity — especially if you’re thinking long-term.
Tomorrow, we’ll explore why volatility is like fire — dangerous if mishandled, but powerful if used wisely.
Key Takeaways
✅ Bitcoin’s price moves more than most assets — but that’s part of its nature
✅ Traditional currencies lose value slowly, but surely
✅ Understanding volatility helps you make smarter decisions
