What are the major factors that influence BTC price?
Satoshi Nakamoto himself said that bitcoin mining is like gold mining. And it was not just beautiful words. The fact is that the value of gold is determined by its rarity and supply. These qualities - rarity and supply - determine the price of bitcoin in exactly same way.
📌Supply
Essentially bitcoin is a set of digits derived from a set of mathematical operations. The resources that are expended for mining are included in its cost. It's not only the cost of electricity, but also investments in equipment for mining and the cost of transactions. The more bitcoins are made, the harder is to mine next ones. Therefore, these indicators will only grow with time.
📌Rarity
The release of bitcoins is limited - there will be produced only 21 million coins. This will lead to a reduction of miners (there will remain node operators and other infrastructure servicing people), as well as to reduction of the numbers of bitcoin. This will happen because people will lose the keys to their wallets, die and don't tell nobody the passwords. When number of bitcoins become less, it's value will only become higher.
📌Agreement
But the most important factor affecting the price of bitcoin is consumer demand, the fact that people are ready to pay fiat money and other material goods for it. The same is with gold: it’s valuable, because one day long ago people decided this way.
Get accurate trading signals and expert recommendations from professional traders.