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I hope you are all doing very well. Alhamdulillah I am very well today. We will have a brief discussion on when and why bitcoin price rises.

So let's get started.

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Bitcoin, the price of this top cryptocurrency is currently at a good level. We have seen the value of this cryptocurrency go up and down. Yesterday (23-01-2024) we saw the lowest price of this cryptocurrency in almost seven weeks.

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Bitcoin is worth $38K _{(Date: 23-01-2024)}. On that date, the price of Bit Coin suddenly dropped slightly. We noticed the same time with Bitcoin that the price of Ethereum was going down.

When does Bitcoin price go up, why does it go up?

Bitcoin is a type of cryptocurrency or digital currency. And cryptocurrency is not controlled by any central bank or government. So it is not easy to understand which way it is going.

How is Bitcoin Value Determined?

Since it is not controlled by a central bank or government system, things like monetary policy or economic development have no influence here. Factors that influence here are:

• Bitcoin supply and demand.
• The cost of producing bitcoins through mining.
• Amount of Bitcoins.
• Bitcoin's internal governance system.
• Through which Bitcoins are exchanged.
• Fees received by verifying transactions on the blockchain.
• Various state restrictions on Bitcoin transactions.

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Bitcoin supply and demand

Because Bitcoin is so popular and its quantity is so low, it is generally in high demand. As the central bank of the country circulates new currency notes, the process of Bitcoin circulation or creation is called 'Bitcoin Mining'. For this they have to setup special computer parts, solve mathematical problems and in return they get bitcoins as a reward. This is known as mining.

The rate of production of bitcoins by this mining is predetermined and it will gradually decrease. When this limit is exceeded no more bitcoins will be created. Bitcoins are pre-determined as to how many can be created. The cost of creating new bitcoins is also increasing. It is fixed in advance how many bitcoins can be created at any given time. Bitcoin mining has become quite competitive due to the fact that the cost of production is increasing drastically compared to production. And this has a big impact on the price of Bitcoin.

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Bitcoin internal management system

Software developers and miners do much of the work to complete Bitcoin transactions and keep the Bitcoin network secure. As there is no central control system, the burden falls on them. Bitcoin transactions are quite slow due to software limitations and increased demand. As a result, investors may feel frustrated and opt for other cryptocurrencies. Which in turn may affect the price of Bitcoin.

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When does the price of bitcoin increase, when does it decrease?

There are many factors behind the price of Bitcoin, but hype, news, speculation, etc. have a lot of influence. For example, investors sell bitcoins when they get negative news. When many investors sell together, prices naturally fall. If they get any positive news, they want to keep buying bitcoins, so the price goes up again.

And when many institutions choose Bitcoin as a medium of investment and exchange, its price rises. Many people don't trust their country's currency so they don't choose Bitcoin and its price goes up.

Bans from different countries affect the value of Bitcoin. When Chinese banks were ordered to stop all transactions in Bitcoin around 2021, the price of Bitcoin plummeted immediately after. So it can be said that the central ban or the ban of various states has a huge impact on the price of Bitcoin.

So that was today's review.
Thanks for reading.

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