 # Geometric Mean The geometric mean in cryptocurrency is used to calculate the average rate of return or growth in the price of an asset over a certain period. It differs from the more common arithmetic average in that it takes into account not only the amount of price change but also the percentage change.
The idea is that asset prices are multiplied with each other, and then the root of degree equal to the total number of periods is extracted. This allows you to take into account the percentage change in price and obtain the average rate of return or growth of the asset.
The geometric mean in cryptocurrency can be a useful tool for analyzing and evaluating investment returns. It allows you to take into account the compounding nature of the asset's growth and to see the total percentage return over the period in question.
However, it should be noted that the geometric mean has its limitations and can be sensitive to outliers or price extremes. Therefore, its use requires caution and additional analysis of other factors related to the investment asset. 