Bitcoin is getting boring at a time when annualized 30-day volatility as of Thursday’s close has seen a sharp downward dip, in a March with its own type of (weather) volatility.
Source: CoinDesk Bitcoin Price Index
To emphasize the point, have a look at the chart above, which shows the volatility of bitcoin daily returns for the past month. To be fair, I’m employing a little chart crime here, starting the y axis at 40% in order to accentuate the drop between March 24-25, as all but the last days of February have disappeared from the 30-day look-back on the CoinDesk Bitcoin Price Index.
The boredom engendered by a tame month sparked a mild disagreement with “First Mover” show host Lawrence Lewitinn about penny stocks versus bitcoin. We were discussing the benefits of using indexes weighted either by price or by market cap. Price-weighted indexes can be more volatile because smaller-cap components can have a greater impact. I said a crypto index doesn’t need more volatility because crypto assets already have the volatility of penny stocks.
Also read: Why Bitcoin Is More Like a $100 Bill Than Gold
Naturally, I had to go look up penny stocks and compare them to bitcoin’s volatility. A penny stock refers to the stock of a small company that trades for less than $5 per share, sometimes on big exchanges but more often through over the counter (OTC) exchanges.