Why is the bitcoin rate falling?

The topic of the bitcoin rate is currently becoming popular and frequently discussed. At first, the independent digital currency tries to maintain an upward trend, which raises the overall level of the cryptocurrency market, and then it plummets in value. Let’s take a look at why this happens.

Bitcoin rate: what does it depend on?

The value of the “golden currency” is influenced by a number of factors. These include: – the location where the cryptocurrency is issued; – the country’s gross domestic product; – currency imports. These are general factors that affect the global currency market. However, they have an indirect impact on the formation of the bitcoin exchange rate. For an objective assessment, experts also advise considering additional factors that affect the growth and decline of the cryptocurrency rate.

What influences the bitcoin exchange rate?

– Increasing the degree of trust from investors. As the saying goes, demand creates supply. In this case, demand is the growth of trust among financial experts, investors, and regulatory authorities in the most popular independent digital currency. Simply put, the stability of the exchange rate depends on people’s trust in it. It should also be understood that much more depends on the country’s updated bills on the “golden currency”. – Increasing popularity of Bitcoin as a payment element. Today, almost every company operating via the Internet accepts payments in Bitcoin. Currently, there is no general system of regulation of cryptocurrencies in the world that allows exchanging products and services for bitcoins. In countries where the population is not familiar with digital currency, Bitcoin is practically not used for this purpose. As interest in cryptocurrencies as a means of payment grows, demand will increase significantly. Then the exchange rate will be stable. – Simplification of the system. The moment the system of this digital gold becomes more understandable and accessible to users, its use will increase. – Political aspects. The volatility of some cryptocurrencies creates a human interest in finding an alternative. For example, the confiscation of many large banknotes from the country’s circulation and the devaluation of money have had a positive impact on the optimal stabilization of the Bitcoin exchange rate.

The main reasons why bitcoin is falling

The first reason is the presence of potential difficulties. The bitcoin cryptocurrency may find itself in a crisis if the network itself stops working. The second reason is the problems that are directly related to the mining of an independent digital currency. This causes a decline in miners’ interest and performance. The third is Internet attacks on currency exchanges by experienced hackers. Not long ago, one of the largest exchanges in Korea, BitHumb, was hacked by professional hackers. The company’s founder, Charli Li, and his experts believed that the hack would not affect Bitcoin’s price, but its rate plummeted. Now, all financial experts and investors are afraid of this.

Why did bitcoin crash?

Experts in the field claim that the extreme decline in the price of the most popular digital currency was caused by negative news from the cryptocurrency industry. Many professional analysts believe that the current decline in Bitcoin is closely related to the hacking of the famous Korean crypto company BitHumb. In addition, most believe that the situation has worsened after the owner of Western Union made a statement. He stated that their service would not be introducing a solution that could help users make payment transfers in the digital currency market.

Is it necessary to invest in bitcoin?

No one can answer this question for sure right now. Even if large investment companies influence the cryptocurrency market and are able to manipulate the exchange rate, the market itself is not subject to their absolute control. The mass media daily provides contradictory news about the state of the “golden currency” and the peculiarities of its formation and development. Given these factors, it is up to each user to decide whether to invest in bitcoin or not. The existence of strengths and weaknesses depends on the growth of the sector, the elimination of problems and difficulties, and the increase in the level of trust.