Reason for fluctuating price value of bitcoin
The price value of bitcoin has never been stable. Sometimes, it increased slowly, sometimes decreased gradually and sometimes these changes happened drastically. So, it can be said that bitcoin’s price value has seen many ups and downs, sometimes these changes well slow and gradual and sometimes these were drastic. Now, what’s the cause of such a dramatic change in the price value of bitcoin. It becomes important for investors as well as its developers. There are many reasons for fluctuating price value of bitcoin. This article will talk about those factors and how bitcoin emerged and took its position back once again.
Before going to the reasons for these drastic changes, we must know what decides its price.
The main deciding factor of the price value of bitcoin is ‘Demand’. It is simpler to understand like when everyone or many people want the same thing, the value of that thing will increase, increasing its price value. This factor is applicable in approximately every area, and hence, it can be understood easily that demand has always been the deciding factor of price value.
Most significant reason for fluctuating the price
The primary and most significant reason for such remarkably noticeable changes are reviews of famous figures. This is not new in the market. It has been using by advertisement companies for a long time. For example- if we see a beautiful and famous actress in an advertisement for cosmetics, we believe it will be beneficial and lovely. Same goes for bitcoin, when given good review or good comments by some famous economists, investors or any such people, its demand rises, resulting in the rise in the price value of bitcoin from different websites like YuanPay Group login. Now, it is different from the example of advertisement one in only one few aspects.
Like, bitcoin doesn’t hire famous economists and investors for advertising. The comments and reviews are made by personal experience and knowledge. The same goes for vice versa; its price decreases when given negative reviews or comments by public figures. Such incidents cause a rapid reduction in the price value. Simultaneously, it is often noticed the price value of bitcoin restored its original value soon. If we try to understand why after some negative reviews too, bitcoin can rise again because of the developer’s constant trying and eradication of issues and problems. As soon as people face some problem, it is fixed, causing restoration of price value.
Now, let’s have a look at such incidents
There were incidents when bitcoin’s popularity caused chaos in the international market and government of different countries. This resulted in the banning of bitcoin in some countries. This banning affected bitcoin’s price value greatly, but soon some countries announced it to be legal, and some permitted its uses with a few restrictions. And this caused a fast comeback of bitcoin in the international market. One such ban was the ban of bitcoin in China. In this ban, the first step was taken in September 2017 and was entirely banned in February 2018.
Of course, this legalisation issue greatly affected bitcoin’s price value, but soon bitcoin made a grand comeback with some developers’ modifications and trust. There were times when issues of scam and fraud started to happen. This is a common thing. If people find something developing fast and extensively, they try to find a shortcut. This also caused a likely decline in the price value, but once again, with a few modifications, bitcoin was able to make a comeback. Incidents related to this happened in 2018.
There are also some examples of the rapid rise in the price value of bitcoin.
The price value of bitcoin increased significantly when Elon Musk tweeted about Bitcoin and praised it. Within an hour, it rose by approximately $5000, making its price value $37,299.
Again, the tesla group announced $1.5 billion in bitcoin and were thinking about receiving payments in bitcoin. This announcement caused bitcoin to reach a price value of the highest of all time of $44,141.
Like every other product or anything else with criticism and issues, its price value faced decline. Simultaneously, with positive feedback and reviews and comments and improvements made by developers, it restored its previous price value and even increased drastically.