The main idea behind the creation of Bitcoin was to create a deflationary currency that could serve as a decentralized alternative to people, without the intervention of public or financial institutions. This means that users could, over the years, revalue their investments with a cryptocurrency whose value would necessarily increase every 4 years.
Bitcoin has been constantly growing in value compared to fiat currencies throughout its history. Although volatility has been a prominent factor by cryptocurrency detractors, an analysis of their behavior since 2010 yields an important fact: the minimum value of BTC per year has increased steadily.
The Buy Bitcoin Worldwide platform shows each year that minimum BTC value with respect to the US dollar has been growing, with only one exception. Between 2014 and 2015, the minimum price of the ecosystem cryptocurrency fell from USD 319.64 to USD 177.28. Bypassing this stage, there has been an increase every year over the previous 365 days.
For example, the lowest value recorded in 2010, the year following the creation of bitcoin, was USD 0.06. For the following year, the lowest price was almost 5 times higher, as it was never below USD 0.29.
In 2012, the growth was even greater. Throughout that year, the lowest price of bitcoin in the market was USD 4.22, which represents an increase of 1,355% over the previous year.
For 2013, the minimum levels had an increase of more than 200%, going to USD 13.30. In 2014 there was the largest increase of this type in the history of cryptocurrency. In total, the lowest price of BTC in the whole year was 2,303.31% higher than in 2013. During its worst time of the year, the value of bitcoin was USD 319.64.
2015 was the only annual downturn in the minimum price of BTC. Since then, the following years returned a solid sample of growth. In 2016 the lowest price was USD 358.77, then bitcoin had its worst moment of 2017 at USD 775.98 and last year the lowest price was USD 3,214.39.
So far this year, after finishing the first 8 months of this 2019, the upward trend has remained. The lowest price so far has been USD 3,385.97, according to Buy Bitcoin Worldwide. That is, 5.34% above the previous record.
Even with the current value of the cryptocurrency, more than USD 10,220 at the time of writing this note, bitcoin is far from its historical maximum. At the end of 2017, the price of bitcoin was close to USD 20,000, as can be verified through CoinMarketCap.
Bitcoin volatility in the cryptocurrency market
Volatility is a characteristic of the cryptocurrency market. However, for analysts of Messari, bitcoin and other cryptocurrencies with high market capitalization, they are less susceptible to these price fluctuations, compared to cryptocurrencies with lower capitalization.
The firm would have published a report a few weeks ago stating that cryptocurrencies with greater market capitalization have annual volatility of around 90%, according to Messari data. This percentage is growing as the capitalizations are lower, add the Messari researchers.
As for the volatility of bitcoin in recent weeks, there has been a significant decline. According to figures from Blockforce Capital and Digital Asset Data, the cryptocurrency’s 30-day volatility fell more than 50% between July and August of this year, from 131% on July 19 to 64% on August 25.