Frank Holmes of US Global Investors Explains Cryptocurrency Volatility

    Although cryptocurrencies have a promising future, one of the biggest hurdle it has to overcome is the current volatility. Understanding some reasons as to why cryptocurrencies are much more volatile than other assets in the market can help investors better cope with expectations and make sound investment strategies.

    Frank Holmes, the CEO of U.S. Global Investors does just that in this short video.

    This past year has seen an incredible rally in the crypto world. Huge abundance of people is following and tracking it. With bitcoin becoming a commodity, a future’s market instrument we saw the price of bitcoin peaking.

    And this year, 2018, there has been nothing but lots of negative news and news of regulation coming in, and then there was the introduction of taxes on cryptos. Now it appears that the prices have bottomed out. There were some big pickups and rallies.

    One of the most significant development was that CFA society is now to include cryptocurrency as part of the curriculum. Additionally, the federal reserve has created its own crypto index. So with all the negative narrative, there is something very positive, something like an undercurrent, that lends itself that this is a really important space and it’s only got more upside than it has a downside.

    What investors really have to be sensitive of short-term is the DNA of volatility. When we look at gold, the DNA of volatility says that 70% of the time, which is one standard deviation, gold and the S&P 500 go up or down 1%. It’s a non-event. When they go 2% or 4%up or down, then it starts to become significant.

    However, cryptocurrency world is much different. They have a daily volatility of 5-7%. The significantly higher volatility has a rational reason for it. Whenever you cap the number of coins that are supplied to the marketplace, then naturally, you’ll have more volatility.

    understanding cryptocurrency's "DNA of volatility"

    Holmes concludes the video by saying, “So stay tuned for something big happening in the crypto space, in the blockchain world. It is early investing. It’s very speculative but it has lots of opportunity for tremendous upside.”

    Get Free Email Updates!

    *Action* Enter Best Email to Get Trending Crypto News & Bitcoin Market Updates

    I will never give away, trade or sell your email address. You can unsubscribe at any time.

    Bitcoin Exchange Guide News Team
    B.E.G. Editorial Team is a gracious group of giving cryptocurrency advocates and blockchain believers who want to ensure we do our part in spreading digital currency awareness and adoption. We are a team of over forty individuals all working as a collective whole to produce around the clock daily news, reviews and insights regarding all major coin updates, token announcements and new releases. Make sure to read our editorial policies and follow us on Twitter, Join us in Telegram. Stay tuned. #bitcoin

    [Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

    [Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer


    Please enter your comment!
    Please enter your name here


    Live Bitcoin Price & Latest BTC Chart News

    Today's Latest Crypto News

    Celsius to Implement Compounding Interest on Cryptocurrencies Deposited in Its Wallet

    Borrowing and crypto lending platform Celsius's Founder, Alex Mashinsky announced, that starting February 1st, they will begin applying compound interest for their customer's wallets. The...

    BlockFi To Cut Rates For ‘Tier 1' BTC And ETH Lenders While Boosting ‘Tier 2' Starting Feb 1

    BlockFi announced changes in its Bitcoin (BTC) and Ethereum (ETH) lending yields starting Feb. 1. Changes follow the increasing price and interest in...

    MENA’s Unbanked to Drive Crypto Adoption While China’s 5G SIM Cards to Enable Digital Payments

    In MENA region, two-thirds of people unbanked but over half of the countries have 70% mobile subscriber penetration rate China Telecom working on...

    Are Mining Death Spiral Believers Holding Bitcoin's Price From Jumping?

    Bitcoin hash rate down at 118 Th/s from ATH of 126 Th/s hit on the day BTC price jumped to $9,000 A risk...

    Japanese Lawmakers Are Open to Issuing A Digital Yen To Compete With Libra, Digital Yuan

    A group of Japanese lawmakers from the ruling party came forward with the proposal of Japan issuing its own digital currency. It seems China’s determination...

    Bitcoin’s Privacy Update Schnorr/Taproot Reaches a New Milestone

    One of Bitcoin’s biggest upgrades that will improve the privacy of the network has been published on the GitHub as BIP 340, 341,...

    BitcoinExchangeGuide is a hyper-active daily crypto news portal with care in cultivating the cryptocurrency culture with community contributors who help rewrite the bold future of blockchain finance. Subscribe on Google News, see the mission, authors, editorial links policy, investment disclaimer, privacy policy. Got News? Contact us, we are human too. Note: nothing here is financial advice, do your own research thoroughly.