The article is right on one point: Bitcoin is volatile. No one denies that.
However the article is wrong that "volatility must decrease for it to survive". If anything, the fact it has not only survived for 4 years, but succeeded by gaining market share and gaining value (1000x since 2010!) despite its volatility shows that the market does not care that much about volatility.
When the article talks about Bitcon's need to "survive," I interpreted it to mean "survive [as a currency]." Bitcoin makes a fine speculative trading vehicle for those with the cojones to expose themselves to big positions. But as a currency, it does need to "settle down." Think about it from the perspective of a business intending to transact in Bitcoin and prepare for the years ahead. Inventory management, logistics, financial planning, and all the other necessities of running a business as a going concern are extraordinarily difficult when the currency one accepts is fluctuating this wildly.
Exchanges, such as the late Silk Road, do not hold their own inventory, and so those types of businesses make some degree of sense. (Even still, they'd have a very hard time attracting investment, if they ever sought it, because the company's fundamental financial position would change on a daily basis.)
But businesses other than open exchanges face some very serious difficulties when conducting business in BTC. This is one major source of the liquidity issue. The other is that speculative holders and traders far outweigh transactors in terms of the currency's total trading volume. BTC changes hands quite often, but not typically in the form of business transactions, which one would expect of a currency. Far more often it's in the form of buy and sell orders, like a commodity.
Correct: thriving, not surviving. (I would not have made my remark, had the author used "thriving" in place of "surviving").
And we are not yet at the point where Bitcoin needs to reduce its volatility to further grow. My prediction is that there is still room for Bitcoin to grow (and it will), over the next 1-2 years, and yet volatility is going to remain just as pronounced as today. I say this because so far, its adoption curve shows no sign of slowing down.
Yet it looks exactly like the peak -> crash curve of its own history. People we claiming the same thing of real estate in the US in 2008 as well. Yet the correct analysis is still that there's no real reason for Bitcoin too grow - it can't extinguish tax obligations, and any move by governments to tax BTC profits will tank it because payment will have to be made in their currency, not BTC. No one has any reason to hold onto BTC if they're not speculating.
However the article is wrong that "volatility must decrease for it to survive". If anything, the fact it has not only survived for 4 years, but succeeded by gaining market share and gaining value (1000x since 2010!) despite its volatility shows that the market does not care that much about volatility.