Bitcoin is a very popular decentralized digital currency that is used most widely as a cryptocurrency. The price of this virtual currency is not generally regulated by any group, organization or even any government. Also, it is completely decentralized in nature.
The transfer of Bitcoin is conducted over a P2P or Peer-to-peer network. It happens through anonymous digital exchanges – via highly encrypted hash codes. With this kind of network, the transfer of Bitcoin between users are tracked and verified.
Scope of Bitcoin
In the last two years, after a sharp drop in its price, Bitcoin has been found to gain very high. Now it is the most popular as well as most traded cryptocurrency out there.
Furthermore, it is now being recognized as a valid mode of payment by shopping giants like Amazon and even some major financial organizations and banks are using the blockchain technology. It powers Bitcoin to make their operations more secure.
The massive success of Bitcoin and the increasing integration of blockchain technology by banks indicate that the cryptocurrency is going to be recognized as a traditional payment standard in the years to come.
Risks Involved in Bitcoin Trading
You must understand that a high level of volatility is observed in the Bitcoin market and there are wide fluctuations in the price of this virtual currency.
This means that there are risks involved with Bitcoin trading but if you wait it out and invest in this cryptocurrency as a long term strategy, you can only stand to gain.
It is very important to have a proper understanding of the Bitcoin market and how the cryptocurrency works. So, before making any investment into it, you have to know about it properly.
Bitcoin Trading Tips
It is essential to have a diversified portfolio and make use of a long term strategy. Do not expect high returns from it over the short term.
Also, do not go by the media reports only. It is often that negative media coverage is received by Bitcoin – which is often prompted by vested interests. It is like an attempt to make other virtual currencies gain in prices.
Always keep your Bitcoin stored in secure wallets, so as to ensure its safety while trading. Make sure that you have a proper idea about who you are trading BTC with, so as to avoid risks and losses. You can select bitcoin up for a secure and user-friendly trading app to buy Bitcoin
What are the Top Factors Affecting Bitcoin Prices?
Across the world, governments are struggling to regulate Bitcoin – as its price goes on rising exponentially. The regulation helps to give protection to the investors and increase the taxes. Predicting and understanding the factors driving the ups and downs of Bitcoin is essential. It can be easier to make forecasts regarding the cryptocurrency in a better way and have a better overall understanding of the crypto market. Therefore, read the following factors that affect the prices of Bitcoin.
Demand and supply
The sum of Bitcoins that are traded on crypto exchanges are only a small part of the total amount of Bitcoins that are in circulation. Given the fact that most of this cryptocurrency is held in the form of savings, it is not available always for purchase purposes.
The price of Bitcoins can be affected by its acceptance among users. When the currency is more popular, its prices will increase, whereas there will be a reduction in its value if there is a low demand for it. When there is a higher demand, but reduced supply, the price of Bitcoin will get increased.
BTC rules and regulations
The value of Bitcoin drops when the regulations become stricter. Hence, yes, strict regulations are one of the affecting factors of Bitcoin. However, if the rules are favorable to the Bitcoin industry, they can ensure fast growth by acting as a catalyst.
Various reports displayed in the media have shown a big impact on the prices of Bitcoin as well as other cryptocurrencies out there. When Bitcoin gets positive media coverage, the prices are generally higher; whereas negative coverage leads to a drop in its value.
Competition of Bitcoin
When Bitcoin gets competition from other important virtual currencies in the market, such as Etherium, Altcoin and Tether, its price can be influenced as a result. In the ever changing scenario, the currency price can be impacted by the market cap.