Factors That Influence the Price of One Bitcoin
Bitcoin is the first currency that was introduced in the digital world as the first virtual currency. It is said to have come into existence after the recession of 2008, through a white paper published calling it the first electronic form of cash. Its inventor is not ascertained but SATOSHI NAKAMOTO has been held as its originator.
This currency was developed as a convenient method for its investors as it has certain features that make people give a thought about it. It is not controlled like any other institution that is directed on the terms of its controlling authority. It has a public ledger where people check upon and do trading with each other through an open platform. There is a blockchain technology that keeps in its blocks all the data related to any transaction and hash of the old and the new data. If you want to receive only profitable outcomes check out the useful bitcoin guide.
Further, all these online transactions ensure protection and security through their cryptographic features. It provides encoded transactions through the usage of keys that are sometimes the same for both parties and sometimes different. After Bitcoin, there are a number of cryptocurrencies that have come into existence that are based on different blockchain technology and have different features from the other currencies.
THE FOLLOWING FACTORS INFLUENCES THE PRICE OF A BITCOIN:
1. ITS COMPETITORS
As we know there are numbers of cryptocurrencies that have come into existence after Bitcoin, but still, it holds the top position amongst its competitors in terms of its value, price, and also in terms of investing also. As per the latest reports, the top competitors it has is:
All these altcoins exercise fair competition in the crypto market giving Bitcoin the hike by its popularity to be top in its investor’s choice.
2. ITS EXCHANGE TRADE
If we look at the currency exchange, Bitcoin is also in every currency exchange that makes it more popular in terms of investment because not every currency exchange has included in its list all the cryptocurrencies. So, its presence on popular platforms is another reason for giving its price a proper determination.
3. ITS SUPPLY AND DEMAND IN THE MARKET
Bitcoin’s supply is dependent upon two main factors, the one is its exchange rate on which it is created and the other is their permissible limit to exist in the market, as both the factors are restricted it makes its supply slow and as a result increasing its demand in the market.
4. ITS MINING COST AND REWARDS TO THE MINERS
This is another factor that determines the price of Bitcoin, as bitcoin is too popular in the market, and its mining takes a long time and consumes high electricity resulting in determining its price and they are also limited in the market too that is another reason that determines its price.
5. ITS GOVERNANCE
As we know its governance is not attributed to any central agency, it relies on blockchain technology for its governance. As its block size is small and it processes less transactions per second it also makes it an expensive currency.
The article above talks about the factors that are responsible for its price determination. These factors have been enunciated in brief and in the easiest way possible. As we know Bitcoin is one of the most popular coins in terms of its market cap and also its availability in the crypto exchanges.
I hope the article would have cleared your doubt relating to Bitcoin’s price determination and would bring you an easy way to understand the crypto journey as a trader.
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