Bitcoin's value depends on how profitable the market (the general population purchasing and offering Bitcoin) supposes it is. Consider a portion of the more physical things you can as of now put resources or invest into, for example, Gold. The cost of Gold relies upon its free market activity. For instance, when another Goldmine is found, the value drops. This is on account of more Gold winds up accessible thus it is no longer as uncommon. So the rarer Bitcoin is, the higher Bitcoin value predictions are. Hence, bitcoin is not an exemption to the law of supply and demand.
The example of Gold is similar to how Bitcoin’s price changes. However, the price of Bitcoin usually changes because of the news that is published about it. Here’s how it works:
1. At the point when there is awful news distributed about Bitcoin, there are significantly a bigger number of individuals offering Bitcoin than purchasing Bitcoin. These individuals offer their Bitcoin at lower costs than the present value so they can offer it quick. This makes the value drop.
2. At the point when there is uplifting news about Bitcoin, there are a larger number of individuals purchasing Bitcoin than there are individuals offering it. These individuals purchase Bitcoin at higher costs than the present qualities with the goal that they can get it rapidly. This makes the value rise.
do you agree with this? what are your insights?
I don't think the news are the reason for bitcoin's price decrease. It depends mainly on the global sentiment around the bitcoin. However, the news can only spread that sentiment across the globe acting as catalyst. Bitcoin's price movement is closely tied with the global regulations as well. If a country decides to ban bitcoin, you will see an adverse effect on the price and vice versa. The fact is, bitcoin's price depends on many factors which can't be accounted correctly. Also market manipulation by the whales is another reason for it.
But every price decrease comes with an opportunity for the long term believers of bitcoin. I personally know few persons who buy bitcoin during each decrease and I am also one of them. I see it as an opportunity to make profits. So the second statement of yours is partially true. Definitely with positive news, market receives more purchase orders but the volume remains high even when the market slumps.
The entire thing is complicated and very diverse. It is impossible for a person to factor in every possibilities on which bitcoin's price is based on. That's what makes bitcoin a speculator's heaven.