What volatility actually tells you
Volatility is just the size of the typical swing — not the direction. A coin with a 3% average daily move isn't going up or down; it's telling you that on a normal day it travels about 3% from where it opened. The number most sites quote is annualized volatility, which scales that daily figure up to a yearly one. Crypto trades 24/7, so the annualizing factor is √365 ≈ 19.1: a 3% daily move becomes roughly 57% annualized volatility. Bitcoin typically sits around 40–60%, large alts 60–90%, and small-caps can run well over 100% — meaning a one-standard-deviation year is a swing wider than the entire current price.
Volatility scales with the square root of time
The most important and most-missed fact: risk does not grow linearly with time. A one-day move of 3% does not become 21% over a week — it becomes 3% × √7 ≈ 7.9%. Over 30 days it's 3% × √30 ≈ 16.4%. This is why a position can look perfectly safe overnight and still get liquidated if you hold it for a month: the expected swing roughly doubles every time you quadruple the holding period. The table above does this scaling for you, and the optional leverage field shows how close a 1σ move sits to your liquidation.
How to use it for sizing and stops
If your stop-loss is tighter than the coin's normal daily move, you're not trading — you're donating to noise; it will be hit by routine wiggle before your idea has a chance. If your liquidation is inside the 1σ daily band, you are over-levered for this asset and a single ordinary day can end the position. Match your leverage and stop distance to the volatility: pair this with the volatility liquidation risk calculator to see your cushion in days of movement, and the position size calculator to size from a sensible stop.
How to use it
1. Enter the coin's typical daily move, or switch to the 24h high/low mode and paste today's range.
2. Enter the current price (and your leverage if you want the liquidation context).
3. Read the annualized volatility, then the expected move and price band for each horizon.
FAQ
Where do I get the daily move number? Use the preset chips for a rough class figure, or switch to high/low mode and enter today's 24h range — the tool turns the range into a daily move estimate. For precision, take the standard deviation of recent daily % changes.
Is this implied or historical volatility? Historical/realized — it's built from how the price actually moves. Options markets quote implied volatility (the market's forward guess); the two are usually in the same ballpark but can diverge before big events.
Why √365 and not √252? Stocks only trade ~252 business days a year, so equity volatility uses √252. Crypto never closes, so every one of the 365 days is a trading day.