Different Ways to Control Bitcoin Volatility

Bitcoin became available in 2009 when it was introduced by a pseudo-anonymous name- Satoshi Nakamoto. BTC is an open-ended digital currency with a decentralized finance system called the DiFi. In the initial days of its launch, many questions were raised, and confusion was discussed. However, as individuals get accustomed to its secured system and straightforward interface, the BTC market started to make jumps like no other. BTC became the leading name in the crypto market and was on every investor’s list. A factor about BTC that attracts and distracts investors is its volatile nature. The BTC market fluctuates highly, which has resulted in both unimaginable profits and losses to investors and traders. AltCoinWealthPro is an easy gateway to the crypto world, especially if you are a beginner and wish to understand the fundamentals first.

What is Bitcoin Volatility?

Volatility, as the name suggests, refers to a trend featuring rapid movements in the value of an asset. The market has seen unprecedented fluctuations regarding BTC volatility, with 10-15% daily changes.

There are several reasons for BTC volatility, and while it is not possible to pin down the exact reason, experts suggest that the standard demand and supply system mainly drives it. In addition, BTC is hard to mine and has been fixed at 21 million, making the market even more volatile.

In addition, the media plays a significant role in the value of BTC. Precise data suggested a significant jump in the value when BTC was being promoted on different social media platforms and how the prices went down with the decrease in the promotion. This factor is unique to BTC, as no other asset gets influenced at this rate.

How to Control BTC Volatility?

Since the volatility depends on several factors, it might be impossible to follow a single step to beat or control its volatility. However, investors and experts are inclined towards specific advice and methods to understand the fluctuations better.

1) HODL

HODL means “hold on for dear life”, and it is a common trend followed in the crypto world. The method emerged when a beginner in the market needed to learn how to navigate through and held his BTC for a long time, resulting in vast and reliable profits. Since then, HODL has become an integral part of investing, especially for those not here for life-changing risks.

2) Diversify Your Portfolio

Experts need to stress more the role of diversification in investments and controlling volatility. Diversification means widening your BTC investing profile by investing in different BTC profiles rather than putting all your eggs in the same basket. This helps you easily sail through volatility as there are close to zero percent chances of all BTC profiles facing a bear trend simultaneously.

If you look at the data, it suggests that you should not be putting more than 10% of your capital in a single profile.

3) Stay Out of the Wave

The BTC market is highly volatile, which means there are more chances of being influenced by fluctuations in the value. Therefore, the wisest way forward is to stay out of the waves. This is to say that stay away from buying or selling during a wave. This brings more steady and reliable profits for you. Some might say that staying out of the wave will not bring huge profits, but when aiming to beat volatility, it is always a good step to go for steady profits rather than dramatic returns.

4) Research Well

Investing is all about researching and knowing the source better. The same applies to controlling volatility. It is recommended to conduct planned research before investing in a market that showcases a dramatic return scope. Research helps you choose profiles with steady returns and protects you from being overexposed to fluctuations. In addition, you must also be updated with the latest advancements in the market to ensure that you are making informed decisions. For instance- The BTC market marked a massive decline towards the end of 2021, and there have been questions about the chances of revival. It is suggested to evaluate all the latest trends before you step in.