4 Key Things That Impact Bitcoin Value Today
Posted On August 4, 2023
The price of Bitcoin, and overall Bitcoin value, fluctuates because of many factors. Many skeptics describe it is as a very volatile currency and at the moment it is. But what causes such sharp fluctuations?
Here are 4 key things that impact Bitcoin value today.
Even though Bitcoin is decentralized, there are some decisions that still need to be made from time to time on how it will evolve. For instance, a decision to create a «hard fork» was made on August 1, 2017. This resulted in the creation of a new digital currency, Bitcoin Cash. Most users were not sure what this fork meant and the uncertainty pushed prices and overall Bitcoin value down for a while but then the prices rose steadily afterward.
When South Korea announced its intention to ban Bitcoin trading, overall Bitcoin value by an incredible $1, 000 in mere minutes. Bitcoin regulation by governments of countries that have a high number of Bitcoin traders usually causes a panic in the market. As the masses run to sell their Bitcoins, the prices nosedive.
Demand and supply curve
There are only 21 million Bitcoins available for mining. As the demand for these limited Bitcoins increases, prices and overall Bitcoin value will keep increasing. Fear of missing out (FOMO) is one reason the demand for Bitcoin keeps increasing. FOMO happens when people see and hear how others are making a fortune and they do not want to miss out on the opportunity.
News and events
Trading views are shaped by what people hear on the news. Negative news, like the closing down of major exchanges, or the hacking of digital currency websites, can affect the prices of Bitcoin. On the flip side, positive news, like the introduction of futures trading pushes the Bitcoin value through the roof.
While it is true that Bitcoin prices are volatile, it is also a fact that overall the price has risen over time. A careful examination of the charts reveals a steady increase in average price ever since its inception. If this is anything to go by, we can safely infer that Bitcoin value will keep rising into the future.