Bitcoin isn’t only the oldest cryptocurrency, but also the most successful one. With the beginning of the crypto era, there were and remain many imitators, but no other token has been able to compare with price increases yet. But what exactly influences the Bitcoin price and why is bitcoin price dropping?
The year 2020 seems very good for Bitcoin investors. For the first time since September of the previous year, the price climbed to over $10,000 again. The market cap is currently more than $180 billion.
Market capitalization means market value. Crypto experts mention it when it comes to the total value of Bitcoin calculated, i.e. a product of its market value and the number of coins in circulation. There are also HODL bitcoin investors who deliberately hold their coins until the favorable moment of a profitable sale on the crypto exchanges.
Bitcoin holding serves as an important piece of evidence for analysts making future price forecasts, but there are also other factors that directly or indirectly influence the Bitcoin price. What factors affect the BTC price? Why is bitcoin dropping & rising? Today, you’re going to find out!
Why is Bitcoin Price Dropping: Is Halving the Main Reason?
Nowadays a lot of traders wonder why is bitcoin dropping so much. Why is this happening? In June, the Bitcoin price is below the important $10,000 mark and is at $9,577.
But the recent halving was obviously the right time for investing taking into account the past three price jumps right after a Bitcoin halving. In May 2020, another Bitcoin block was halved. That’s why a so-called HODLER broke into the crypto stage and sold his Bitcoin at very good prices.
At the beginning of 2020, Bitcoin’s share of the total cryptocurrency market cap was around 2/3. The recent BTC price increase is due to the recent halving, during which another block was halved.
Why is bitcoin price dropping today? The most popular cryptocurrency is very unstable due to external influences, much more than the internal factors inside the Bitcoin system.
The virtual currency can hardly be controlled and regulated by states. Сentral banks and regulators cannot influence the Bitcoin rate. However some news — such as the killing of the Iranian major general Qasem Soleimani — are able to affect the rate somehow. Right after the attack on the influential general, many digital currencies significantly increased in value. In addition to Bitcoin, these include Ethereum and Bitcoin Cash.
Uncertain times — mainly international conflicts — also led to price fluctuations on the crypto exchanges in the past. Blockchain technology is a basic tool for decentralized cryptocurrency management. Free of government control and regulation, investors hope for security in the form of digital gold in the event of political unrest or extreme events. Anonymity is a big advantage over buying gold.
Why is Bitcoin Value Dropping: What Do Crypto Experts Think
Why is the value of bitcoin dropping? Taking into account the current situation, it’s rather difficult to give a clear answer. The recent BTC halving automatically led to a crazy price increase.
The next halving is expected for 2024 and 2028. Since then, the blockchain principle invented by Satoshi Nakamoto has offered the Bitcoin funding only through transaction fees. Right before the halving, about 320,000 BTC transactions were processed daily resulting in a miners’ profit of $266,000 per day.
Even if a lot of people are still asking ‘Why is bitcoin dropping today?’, and the Bitcoin price is considered to be very volatile, the hype won’t end and the Bitcoin price will be rising this year. Experts suggest investing in the coin, but apparently this is exactly what investors are about to do today. They save and hold their bitcoins, which can lead to a so-called Bitcoin wave. In the past, this trend was always observed shortly after a halving.
Why is Bitcoin Dropping Again: What Factors Have a Great Impact?
While one group of users is hoping for quick money and rising prices, the others are still wondering why is bitcoin dropping.
Of course, supply and demand also play their role when it comes to establishing Bitcoin value. But in addition to these known factors, there are also important political and global economic events. The trade war between the United States and China is influencing Bitcoin as much as the comments by Chinese President Xi Jinping on the very positive developments of blockchain technology.
While the president spoke of blockchain, he didn’t mention Bitcoin and that is the clear answer on ‘Why is bitcoin stock dropping’ question. This fact made the price change for a short time. The high volatility is one of the main reasons for the constant criticism of investing in Bitcoin. But every positive message also affects the Bitcoin rate as they usually bring profits to investors.
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