With the markets looking so volatile at the moment, we want to see how price changes are impacting perceptions of certain cryptocurrencies. Bitcoin, being the world’s most prominent crypto, does suffer from volatility. The price of Bitcoin changes dramatically even with small market shifts, this is down to the high value of Bitcoin though.
Ultimately, 1% off 1000 is a far greater change in value than 1% off 0.10, even though by percentage, the change is the same. (1000-1%=990, 0.10-1%=0.09).
Over the past month, the price Bitcoin has fallen on average at around 5%. During this time, Bitcoin has risen and dropped by larger amounts, but based on a figure from the 11th of June, compared to today’s price, we see a 5% difference. Even so, this small 5% price change has shaved between $400.00 and $500.00 off the price of Bitcoin
During the same period, XRP has seen an average price fall of around 20%. Therefore, based on these stats, XRP is x4 more volatile than Bitcoin, yet during this period and through a 20% dip, XRP has only lost $0.12 in value.
If you focus just on the actual values and the loss encountered by the two currencies, Bitcoin looks far more volatile than XRP. As a new investor you will ask yourself, which currency is going to lose you the most money. By percentage, it’s XRP by a long way, but by FIAT conversion value, it’s Bitcoin.
There are some issues with this, of course it depends how much you invest. Buying 1 BTC and buying 1 XRP is not the same thing, so we are exploring this on a perception basis alone. Psychologically, it is far easier to deal with the prospect of losing $0.12 than losing 20%, or even of losing $0.12 than losing $500.00, obviously.
By comparing perceived volatility, we can see how future investment may look more attractive within XRP compared to Bitcoin. In some ways, perhaps this is the first indication that Bitcoin has grown a little too big for its boots?