The Fractal Code of Bitcoin: What Entropy Reveals About Market Complexity
TL;DR for operators Bitcoin is not simply “more volatile” than traditional assets. That is the easy answer, and therefore the suspicious one. A recent paper compares Bitcoin, GBP/USD, gold, and natural gas using two complexity tools: Refined Composite Multiscale Sample Entropy (RCMSE) and Multifractal Detrended Fluctuation Analysis (MF-DFA).1 The result is more interesting than the usual crypto-volatility sermon. Bitcoin has the highest summed multiscale entropy complexity, at 74.66, and the widest multifractal spectrum, at 0.62. Natural gas, despite showing high volatility in the return distribution, has the lowest values on both measures: 51.48 for summed RCMSE complexity and 0.21 for spectrum width. ...