What determines the bitcoin price?
The cost of bitcoin is difficult to predict dramatic increases interspersed with equally sharp falls. But why is the price of the cryptocurrency fluctuates so much? And who is responsible for these jumps? All users of the cryptocurrency, the project team or himself Satoshi Nakamoto? Let’s face it. Here are 10 factors that somehow affect the rate of BTC.
The nature of bitcoin is easy to understand if you compare it with gold. Everyone knows what gold is, right? Now let’s try to describe its properties. Gold in nature is small, it is difficult to obtain, its value is constantly increasing, the same amount of gold is worth at any point of the planet is approximately the same, a large piece of gold can be divided into smaller ones. Of course, gold and bitcoin are not the same, but today the cryptocurrency difficult to mine, the demand for it exceeds supply, and therefore it is expensive — and will be her future quite favorable.
With bitcoin does not need banks and their services after the invention of cryptocurrency people understand that the credit institution, constantly deceiving the consumer, this is not the limit of financial efficiency. Bitcoin has become a great alternative because it in financial transaction involved fewer players. Add to this high-speed Lightning system, which will allow you to transfer funds from America to India in a matter of minutes. Thus, the efficiency of bitcoin is the key factor for forecasting future prices.
The price of bitcoin is also determined by many psychological factors. Investors influence the mood of other investors, and simply others, because, if everyone bought bitcoins, and you have no, it can not affect your position, and that social pressure is one of the most significant factors that will propel bitcoin forward.
Also in predicting the value of bitcoin need to take into account the degree of penetration of cryptocurrency in the retail trade, as its prevalence depends on the number of places where it can be spent. It is the same with traditional currency if no one accepts, it is impossible to use. So watch out for the words “accept bitcoin” in the Internet-shops.
No government can control bitcoin, and it’s not that someone does not permit that — it just works. The Bitcoin network is so large that, even combining all the supercomputers in the world, you can’t even control half of the system States are therefore on the price of bitcoin is not affected.
The growth of the popularity of blockchain technology as a whole grows in value and bitcoin because it’s related stuff.
The price of bitcoin affects even the attitude towards cryptocurrencies from various social networks. Imagine that your friend spread the news about the price drop in WhatsApp and Facebook — of course, it will affect the opinion of his friends the users of the cryptocurrency. Thus, in addition to the regulation above, there are still self-regulation.
The fact that bitcoin can be traded online and without intermediaries is very important, because you can, not leaving the couch, just a few movements you can buy or sell cryptocurrency without filling tedious forms — convenience in these matters is very important.
Bitcoin is valuable because it is used by many people. Imagine, why do you need Facebook, if you have no friends? So it is with bitcoin — the driving force of system development are social relations and involvement of millions of people.
Further development of the cryptocurrencies will inevitably affect its prevalence, and then the cost. Among the most important innovations that will impact the usability of the system, it is worth mentioning a bitcoin ATM and exchange traded funds (ETF) that allows you to trade cryptocurrency using standard exchange tools.