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Why Does Bitcoin and the Crypto Market Experience Such Volatility in Price Fluctuations? | Bitcoin Exchange Guide

The cryptocurrency market has been growing during the last ten years since Bitcoin (BTC) was created. Indeed, the most popular digital asset grew up to $20,000 at the end of 2017. Because of this, the market gained traction and increased its popularity among investors. Other coins such as XRP or Ethereum (ETH) surged as well in the last years.

During these ten years, the market has been fluctuating a lot. Indeed, prices could move in just a few days more than 20% without an apparent reason behind this wild price fluctuations. According to Totalcrypto.io there are some things to take into account to understand why prices changed in this way.

The first important thing is to think about supply and demand. This is a very concept that plays an important role in determining the price of a digital asset. The supply and demand of cryptocurrencies tend to fluctuate depending on the public opinion. However, most of the virtual currencies have a limited supply. That means that the supply of digital assets does not change if there is an increase in the demand.

Back in 2017, Bitcoin moved from under $1,000 up to $20,000. In 2018, Bitcoin decreased from around $14,500 down to $3,200. This shows that the price of Bitcoin and other cryptos is not easy to be predicted. Some days, the price of the most popular cryptocurrency could fluctuate more than $300.

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Why Does Bitcoin and the Crypto Market Experience Such Volatility in Price Fluctuations?.