Topic: What makes the market change upon selling? (Read 209 times)

Upon selling, the factor which changes the market is many but the major one is the demand and supply. Generally when the demand increases then the value of Bitcoin also increases. On the other hand when the Bitcoin value decreases the price also decreases. The low market encourages to buy or invest while the high market encourages selling out coins in order to make profit.

More supply will create less demand.

And when you are able to contribute by producing more supply of bitcoins in the circle then you are likely going to make the price lower. But as long as you are not selling it and you are just moving it there's no impact.

Because that means you ate up 1000 bitcoins of demand pressure. Now there are 1000 less bitcoins around the current price that people are trying to buy. Think of market changes in terms of pressure. You sell which relieves buy pressure at that point so the price point will fall. So if people wanted to sell for the price it was at before you sold that 1000 well now there are fewer takers on the buy side at that price. If there are no takers then anyone who wants to sell bitcoin right now has to put in a lower sell price to match a buy bid, thus the price drops to that price. You bought up a little bit of buy pressure but the sell pressure (outside of your sell) did not change and so the price falls to even out the buy and sell pressure again.

The basic explanation here is because of supply and demand. If you bought an Iphone8 today and plan to sell it tomorrow do you think you can sell it at the same price? Of course not because there is supply circulating in the market same thought in cryptocurrency. As long as there are buyers to buy your coin at a cheaper price or even higher the price will never be the same.

If you start selling 1000 bitcoins you will start clearing all buy orders starting from highest one.
This will eventually stop when you reach low levels if you wanna sell it quick. That forces price down.

So if someone purchased every bitcoin currently left to the max cap would that increase the value of each one?

Like everyone had said, it is the simple demand-supply system of bitcoin.
If you sell your coins in one go, it increases the supply which decreases the value of bitcoin.
Though 1000 BTC is not really that much compared to the total volume of bitcoin to tremendously change its price, somehow it can just contribute to the drop.

Yes the coins were still on theory but it would have increased the supply by 1,000 coins to fulfill the buy order as a result of which the price starts to drop.We already know that bitcoin being a decentralized currency solely depends upon the demand and supply for its price.Hence this immediate variation in price.

The price index on exchanges are basically the last price that a coin is traded at.

If you are trading bitcoin on an exchange, then selling a big amount of coins by dumping it onto bid orders will cause prices to go down considerably, since there are only a limited amount of buyers at each level. If you're trading p2p, then you agree on a price beforehand and don't actually affect the orderbook prices on an exchange.

Apart from this, a rumor of a big selloff of known coins (such as the Mt Gox coins) can cause panic around the market and even lead to a panic dump situation as well.

If you had sell 1000 Bitcoin at a time, the supply of bitcoin will increase and demand of bitcoin will reduce.Finally the price of bitcoin will reduced.If the demand of bitcoin is increased,automatically the price of bitcoin will increase. This is common in both bitcoin and other assets in market.

That depends on where you are selling, on an exchange or over the counter. On an exchange, everyone is bidding and if you get to sell your whole 1000btc to a single person who is bidding for it, then obviously the market will not change, but from series of people with different prices set for it, then you simply drive the price down way lower and it is as simple as that. If there is a huge demand for your 1000btc, the influence should not be much, otherwise, with a less demand, then, you know what happens.

first thing you need to know is that price is determined based on how many are buying (demand) and how many are selling. it doesn't matter if you sell 1000 satoshi or 1000 bitcoin, what matters is that how many others are buying how much. if there is not that many buying your 1000 satoshi price will fall and if there is more than enough people to buy your 1000 bitcoin price won't fall.

in other words the following statement is right and wrong at the same time!

it is right because 1000BTC isn't really that much compared to the total volume and it will be absorbed by the market pretty easily.

but it is wrong because you can't compare selling of a batch of bitcoin in one go with the total volume. for that you have to compare it with the orderbook and the size of orders on that. for example current price is $7266 on bitstamp and according to bitcoinwisdom if you sell 1000BTC there price will fall down to $6900 which is about 5% drop and it may even cause a chain reaction that drops the price even lower. which is why we say it is still somewhat easy to manipulate bitcoin price as a whale.

market capitalization is even more wrong than using the total volume because it is completely meaningless. bitcoin market cap could be $1 and the orderbook could be packed with orders in a way that selling even 10000BTC couldn't move it and also the market cap can be $1 million billion and selling 1BTC could drop the price if the orderbook is still thin.

The best way to even explain all these is that, the volume that is being sold may not actually be bought by one single person.

Some are bidding to buy at a lower price and more like an auction market, until you offload your bitcoin, then you may have to keep selling to those who are bidding lower for it and if you see the need to offload it all at once, this automatically drives down the market generally. The market cap is not that huge, so it is normal to see things like this happen.

Laws of Demand and Supply

Demand more Supply less price goes up

Demand less Supply more price goes down.

More sellers means more supply

because the bitcoin you have is scattered, from its origin 1000 btc is owned by a single holder and when it sells 1000btc it belongs to some people. because a single holder with a large amount of bitcoin can affect the market enough.

I will answer your question in two parts:
 
  1. The Effect of Selling 1000 bitcoin on the Market: Base on coinmarketcap Market Cap of bitcoin is $125,894,732,426 with 17,058,537 BTC. Therefore, the 1,000 bitcoin will not affect the market, just as a drop of water affects the ocean.
  2. Supply and demand: For example, the sale of 1000 bitcoin evidence of low turnout on the Bitcoin, therefore, the supply will decrease, leading to a lower price."If we all sell, the price will fall."

Because if you market sell and there aren't 1000 Bitcoins of order at the market price it will drop. Say price is $7500 and 1000 Bitcoins in buy order is present on the exchange but because it isn't a 1000 Bitcoin buy order at $7500, the price eventually leads you closer to $7000 when all said and done. Simple economics, just take a look at the order books across websites and it will all make sense.

So let's say I sell 1,000 bitcoins why would the market price drop if I did such a thing since the coins are still there in theory just moved to another person or a exchange site?