Bitcoin has achieved a high price of $60,504.00, which is an unprecedented milestone for Bitcoin and the entire cryptocurrency community. But also, Bitcoin has grown by over 300% since the halving in 2020, and this was an unexpected record to happen so soon while a lot of investors are expecting Bitcoin is going to reach the mark of $100,000 by the end of 2021.
If you want to invest in BTC or you want to learn what impacts the bull cycle of Bitcoin, it’s important to be aware of what determines the price of BTC.
Not only is Bitcoin the largest cryptocurrency to date, based on its market capitalization, but it is also the first cryptocurrency to reach safe-haven status. Safe-haven assets appreciate in value when there are times of crisis, and they are not impacted by changes in the financial markets or any other economic crisis and difficulties.
Furthermore, Bitcoin’s price in 2020 was only increasing, which also attracted the attention of a lot of big supporters of cryptocurrencies like Tesla and PayPal, among many other brands.
But the main reason Bitcoin is a safe-haven asset is that it has a limited number of Bitcoins that can ever be created in the blockchain network; the total number is 21 million. So, it’s a very restricted supply. It is decreasing as we are mining BTC, and we have already managed to mine about 80% of the entire number of BTC, while a supply of roughly 3 million BTC is left to be mined.
The Explosion of Online Trading
Because Bitcoin is a rare cryptocurrency and its price is consistently achieving new heights, the number of trading sites is also increasing as well as the number of investors that are interested in getting BTC. Also, there are many excellent automated trading sites like yuan pay group where you can register to trade online.
Plus, the Artificial Intelligence-powered software is going to trade for you, or in other words, and the automated trading system will conduct online trading based on technical and fundamental analysis at a much faster rate than regular, manual trading.
Also, it is able to remain a profitable platform even during volatile market conditions. So, you can potentially earn up to $800 in just eight hours of trading here. Another advantage is that are plenty resources to get you up to speed, even if you’re a complete beginner in this field.
We can’t mention the bull cycle of Bitcoin without diving into Bitcoin halving, which is one of the most significant events in Bitcoin’s price trajectory. The halving, as the name says, not only cuts in half the reward that the miners are meant to receive based on their contribution to the blockchain network because they validate the BTC transactions, but it also splits in half the total quantity of produced BTC.
This means that the rate at which Bitcoin is being introduced to the network after each halving slows down as opposed to the entire demand on the market that is growing and larger, especially because, as we mentioned, huge investors are taking part in BTC investments.
Difficulty of Mining
The supply it’s also affected by the protocol that determines is the difficulty of the mining process. This protocol is executed after 2,018 blocks are added to the network, and based on the computing power in the network in it increases the difficulty of mining.
But, because Bitcoin is getting more popular and mining is conducted on a large scale by mining pools and farms, there has been a rise in the number of miners in the network, which means that the computing power is also increasing. So, overall, the supply of BTC is limited, and it is also declining. In terms of the demand for BTC, it is boosted by investors like Elon Musk, who invested corporate cash in BTC and companies that support BTC payments like Square, Twitch, Shopify, and many other brands. So, in conclusion, because the demand is greater than the supply, the price is increasing.