6 Things to know about Price Fluctuations and the Use of Bitcoin

Ever since its inception in 2009, Bitcoin has been a very fluctuating item on the market. The popularity of it never really waned however, growing into a lot more present part of the overall online market as well as the most well-known cryptocurrency out there.

Bitcoin and its inception

While we’ve already established its age, how about we check what Bitcoin actually is? It is a digital currency whose defining feature is its decentralization. That means the possession of Bitcoin doesn’t really have a focal point where all the cash flows. The use of Bitcoin promises lower fees for online transactions and less authority meddling in its use.

It counts as a cryptocurrency due to the use of cryptography which acts as a key source of security for these virtual coins. Bitcoin can be counted as the biggest cryptocurrency to date and the template on which many new cryptocurrencies are based.

If you wish to learn more about its fluctuation and use on the market, read below. Otherwise, if you are already interested in it, we recommend you check out

1. Supply and demand of Bitcoin


Just like with most other commodities, the influence of supply and demand is one of the most potent factors of Bitcoin price fluctuations. The key part of this is the number of existent Bitcoins. As it stands, the higher the demand for something the more likely it is to increase in price. If there’s a scant supply of it it’ll be even more valuable. In the case of Bitcoin, the cryptocurrency is limited to 21 million coins. This means that the more of them there are out there, the fewer new ones are left available. That means each new Bitcoin potentially increases the worth of other ones.

The fluctuation that leads to price drops in this situation would be cases where a decent number of Bitcoin become available for sale. With more items on offer, the price goes down as the competitive pricing by the sellers works the price down as well.

2. Media effect on fluctuations

You may have noticed that in some cases Bitcoin’s worth goes up or down depending on its presence in the news. This is because those showings usually involve a prognosis for its growth or fall that’s published without too much investigation being done to confirm how correct it is. This can lead to people who were on the edge when it came to purchasing bitcoin to take a step forward and invest in it due to positive news. In that same manner, those that are uncertain about the investment hold back at the mention of potential loss of investment.

This can also affect some of the less engaged investors too. Those who hear that the worth of Bitcoin will drop soon are likely to rush and sell their Bitcoin in order to get a return of investment. Basically, the impact of media reports on Bitcoin can be felt in both older and newer investors thus impacting the price significantly.

3. General youth of Bitcoin


Among all the other factors, there is also the fact that Bitcoin is a rather young currency. As such, it is not yet ready to settle down its worth as many others did. Hence why the worth of this cryptocurrency can vary so wildly. As it gets more established, the worth of Bitcoin will become a lot more standard than it currently is. We can see how slight the variations of prices are for most fiat currency used nowadays, that’s due to them having a lot of time to establish and settle down. Keep in mind that this form of currency has existed for centuries now while Bitcoin is barely over a decade old.

Fluctuations will continue until eventually stabilizing, which would require a lot of effort and time that goes into its integration into the current world economy.

4. Mention of regulations

Another situation where dips will usually be felt is during the time when rumors about regulation start going around. The effect usually wanes after a bit especially if rumors are dispelled and end up being untrue. However, it does remain a frequent piece of information to keep in mind. While savvy investors do not pay much mind to anything that hasn’t been properly looked into, a chunk of investors can be easily scared with the unfavorable regulations appearing in the news.

It’s always good to pay attention to these rumors because, if true, they could lead to dangers for your investment and if untrue it’s better to learn about it early. After all, there have been very troublesome situations already that caused serious dips to Bitcoin’s value.

5. Using Bitcoin for online transfers


If you are questioning the actual use of Bitcoin, look no further than online cash transfers. The initial invention of Bitcoin had the simple purpose of allowing people to send money over the internet. Think of it as an alternative payment system.

The online transfers of money have been troublesome for a long time especially with certain limitations put upon them. This way, people using Bitcoin were able to avoid paying a ton of cash for bank-based transfers. Instead, they chose to switch over to the Bitcoin’s type of transfer.

6. Converting cash

These transfers had another benefit. You can transfer cash and then convert it to that country’s currency. This meant that money delivered this way won’t end up being locked online and exclusively used for online purchases. It can now be converted to fiat currency and utilized as you see fit.

Of course, these conversions took a bit to happen but nowadays the Bitcoin conversion is commonplace as is the conversion for most cryptocurrencies.



In the end, the fluctuations of the market are many and usually stem from recent occurrences focused around Bitcoin. That’s why it’s useful to keep in the know daily if you are investing into any sort of cryptocurrency. It is also useful to do this in order to optimize your trades and keep steadily growing your investment. The Bitcoin fluctuations may be frequent but they are often possible to notice before they actually happen leaving you enough time to decide on your next move.

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