How Is Bitcoin Value Formed?

by ddos ·

Bitcoin was launched in 2009, and it stimulated the further development of the whole crypto market. Digital assets do not depend on the government or banks’ regulations as fiat currencies do. Crypto emission is not under state control, and the government cannot limit or increase it. In this article, we will try to understand how Bitcoin get its value. Knowing the factors that affect the price of BTC will help us make a wise decision on buying or selling it.

Bitcoin Market Value

Spring – Summer 2022 turned out to be a challenging period for the crypto market, when starting with Bitcoin, all crypto assets collapsed. We can check cryptocurrency prices live on the Coinmarketcap service to see how the markets dropped. The current Bitcoin value is $22,909,33. The rate dropped this spring, and there were some reasons for it. First, the overall global economic crisis, then FED regulations, and then Binance temporal blocking of BTC withdrawals. That was the chain of events that caused the crypto market to collapse.

Here are general factors impacting the Bitcoin value:

  • The BTC rate depends on supply and demand, market sentiment, and emerging crypto assets.
  • BTC supply is limited to 21 million coins. Limitation of coin issue helps maintain demand for the currency.
  • The expenses for creating one BTC coin. Mining Bitcoins requires costly equipment and enormous electricity costs.
  • Regulations imposed on the crypto industry as a whole.
  • News background.

The rate of inflation and the monetary policy of the government or central banks’ decisions do not impact the Bitcoin rate.

Now that the crypto market lives through a bearish trend, many investors are trying to get rid of their crypto savings. However, as the BTC price has dropped, many, on the contrary, buy BTC for the long term. You can purchase BTC on any crypto exchange like Binance, WhiteBIT, Coinbase, etc. These platforms allow buying crypto with fiat money using a bank card.