Bitcoin’s Price Fell $30K+ Since Last Month—Why Is It So Volatile?

Core Insights - Bitcoin's value experienced a significant drop of over 28% this fall, falling below $90,000 before a slight rebound to $93,848, compared to over $124,000 on October 7, marking a difference of more than $30,000 [2][4] - The cryptocurrency remains highly volatile, influenced by factors such as whale trades and market sentiment, despite expectations for a sustained upward trend due to favorable regulatory conditions [3][4] - The limited supply of Bitcoin, capped at 21 million, and concentrated ownership among a small number of accounts, known as "whales," contribute to its price volatility [6] Market Dynamics - Bitcoin's price fluctuations are driven by basic economic principles of supply and demand, with a small number of accounts controlling a significant portion of the supply [6] - The actions of Bitcoin whales can lead to rapid market changes, as their trades can significantly impact prices [6] - Exchanges implement daily liquidation caps to prevent market meltdowns, which can result in investors being unable to sell their holdings during price drops [7]