It calls for circumstances, being poor and residing somewhere in a rural environment, instead of using banks you decided to hold little savings in Bitcoin, it is too risky because of Bitcoin volatility, your $100 used to save in Bitcoin will not remain exactly that amount, it will either go up or down it can never be stable no matter how consolidated it is.
Exactly. This problem must be addressed if Bitcoin really is meant to be a tool for the "unbanked".
Even if volatility is lowering, it's currently not realistic to bring it down to fiat currency levels. However, perhaps in a couple of years it could equal gold volatility. It would make a huge difference if bear markets didn't go that low. In the case of gold, rarely a bear market goes below 50% of the previous ATH.
That would be at least useful for people who want to save money for a long time and can afford a little loss.Until then, crypto firms however could be creative and offer hedging tools. For example, it would be nice if at my local Bitcoin exchange I could also buy Bitcoin options, which can be one of these tools. You could for example buy a put option to sell your Bitcoins to a price of 70% of the current value to be protected against a major loss. One could pay for these options using a part of the profit in bull markets. Another possible alternative is to design a kind of "insurance" against bear markets.
Doing hedging with additional financial instruments like options would enable you to hold your BTC in self-custodial wallets (Bitcoin Core, Electrum, Sparrow, Ginger ...). You would only have to manage the hedging contracts on a centralized platform.
It's even possible that the hedging / option contracts could also be decentralized, but you would then have to use stablecoins which have their own risks.