Bitcoin’s Bell Curve Betrays It’s Believed Volatility
Despite the headlines that Bitcoin has received for being a highly volatile asset class, it’s not as “risky” as the bell curve would have you believe.
Every year, Timothy “Tim” Steeler would try to guess the number of jawbreakers in a jar at the county fair in the hopes of winning the US$1,000 cash prize and every year he would fail, being off by a huge margin.
And as each year passed, because nobody in town could guess the right number of jawbreakers in the jar, the prize money was snowballed till it hit US$10,000.
So when a friend of Tim’s who was mathematically inclined suggested another method of trying to figure out the number of jawbreakers in the jar, he was all ears.
One person estimating the number of jawbreakers in a jar is unlikely to be accurate, either by going to far over or too far under.
But by getting as many people as possible to take a stab at the number of jawbreakers in the jar, the answer, would come surprisingly close and on a balance of probabilities, increase the odds of being right.
The method, known as the “Wisdom of Crowds” principle, was made famous over a century ago by the famous British scientist…
