Volatility is a metric that measures how much an asset's price has fluctuated over time. In general, the more volatile an asset is, the riskier it is as an investment and the more chance it has to generate either bigger returns or higher losses over shorter periods than relatively less volatile assets. Volatility is one of the most important aspects to consider when evaluating investment risk. If investors believe the possible benefit is worth the danger of losing their money, they will engage in a significant risk.

Crypto, being a younger asset class, is usually seen as volatile, especially when it comes to lesser-known cryptocurrencies. Large volatility is appealing for some crypto buyers since it presents the chance of high gains. Traders with longer-term plans who have reason to anticipate that an investment will eventually rise in value don't have to worry that much about short-term volatility.