Bitcoin’s cryptocurrency is a huge part of the internet market, and accounts for 0.4% of the world’s currency, with 11% of people in America investing in the industry. There are an estimated 5.8 million users worldwide using the virtual system.
Over the years, Bitcoin has changed prices significantly, both dropping and rising as the market demands. It may yet further change as the demand increase, and as more investors join the industry.
While it may not be certain, what these changes could be; here are a few of the factors affecting the Bitcoin industry.
Supply and Demand
Bitcoin is ‘mined’ by solving complex mathematical equations; meaning there is a very limited supply of it, with only 21 million Bitcoin in circulation.
The demand for Bitcoin currency is only increasing as the supply decreases. Investors and companies are buying into the stock; but while the Bitcoin becomes more successful, their supply lowers, and it becomes harder for investors to join the market.
It will supposedly take many years for the Bitcoin mines to run dry, but when they do, the miners – the people solving these complex equations to unlock the Bitcoins – will lose their rewards, the network prices could fluctuate, and market prices could also further increase.
Cryptocurrency is a growing demand in the market industry; they make exchanging funds quick and easy. While Bitcoin is dominating the market, there are other cryptocurrencies and exchanges that offer the same rewards.
Coinbase is claimed as being a seamless transaction, and a much easier experience for its users; however, it is only available in certain countries, and some of the lesser known coin aren’t supported on their system.
Whereas, Binance have over $15 Billion exchanges in the last 24-hours, and are currently the top market exchangers. They offer the lowest fees, making it more accessible to beginners, and have more than 100 currencies available in their system.
These are just two of the exchanges offering transactions for Bitcoin.
However, there are also alternative for using the Bitcoin itself; because of this, Bitcoin’s price is very stable – if there were no competition, the Bitcoin could cost a lot more than what we see now.
Ethereum (ETH) is a programmable blockchain; Ripple (XRP) a global-settlement network that offers cost effective international payments; or Libra (LIBRA) which has yet to launch, but there has been a lot of expectations for introduction of this new platform.
It takes about 10 minutes to mine only 1 Bitcoin, and 72,000 GW (72 Terawatts) of power to mine a Bitcoin using the average amount of power. At the moment, the cost of mining a Bitcoin is between 5 and 8 thousand USD.
As more people join the Bitcoin market, the equations get more difficult, and thus the costs for power and time management increases.
One of the big factors about Bitcoin, they can be sold and converted into real money. While the prices may change, on average, 1 Bitcoin is equal to $30 thousand USD.
The more popular an exchange becomes, the easier it is to drawn in more investors, companies, and third parties willing to create a Bitcoin network.
Since its creation in 2009, there has been much debate on how to regulate this currency, and there has been a lot of changes around the Bitcoin market to meet the demands. The regulations differ from a range of countries.
Bitcoin is known for its decentralised application, it is not owned or partnered with a bank or administrator, so there is no need to exchange currencies through a third party; but these regulations can impact the prices for investors or cause the prices to fall as a result.
The increase in Bitcoin’s exchanges is partly because of the positive media coverage; and this is important to maintain as negative exposure could lower the prices.
The media’s job is to report any changes in the Bitcoin market, and also explain the use of the Bitcoin to a large audience.
These are only some of the main factors that affect Bitcoin’s exchange and prices. While Bitcoin is still a success, with the decrease of supply, the future of Bitcoin is still uncertain.
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