A lot of it has to do with the amount of leverage you're allowed to take on these exchanges. If you have 20:1 leverage, your collateral will automatically be liquidated (or purchased) if the price moves 5% out of your favor. This causes death spirals as more crypto gets dumped (or bought in case of short selling) magnifying the movement.

Crypto needs a strong financial network of derivative products. There need to be instruments to hedge the price risk for short periods. There's no reason you shouldn't be able to cap movements for a fixed time period, limiting the amount you can lose. So if I want to use it as transfer of fiat, I should be able to do so within a reasonable timeframe.

Institutional trader here. Yes, this.

Crypto is popular with traders because it's volatile and fragmented.

On crypto you need an asterisk as this is not a problem with stable coins as USDC or Dai.

Categorically, crypto is volatile. Just because some things aren't doesn't change that.

Overcollateralized stablecoins (like DAI) are not volatile and they are in the category of cryptocurrency. So they do change that. The change is slight, but ever-growing.

BTC's price itself has grown much less volatile.

> the volatility spikes in Bitcoin were most extreme in 2011, with subsequent spikes in volatility lessening over time

https://bitcoinist.com/looking-at-bitcoin-volatility-over-th...

If stable coins are not volatile that does not mean all crypto is volatile.

Agreed. Volatility being profitable just incentives volatility. We usually combat this with regulation but that doesn't seem feasible here.

And as you say, that's the appeal anyway.