The price of Bitcoin, like any other unsecured currency, depends on faith in it. The more people believe in this currency and are ready to buy it, the higher the price of one unit becomes. This is achieved by comparing supply and demand, achieving an equilibrium between them is the cost of Bitcoin.
The capitalization of the Bitcoin market is one of the most important factors of the Bitcoin exchange rate. Two important values are constantly recorded in the global bitcoin turnover network, this is the total number of all bitcoins in circulation and how many billions of dollars were spent on their purchase.
The Bitcoin exchange rate is also related to the total cost of the computing power of the crypto network.
But the most important factor shaping the price of Bitcoin is the human factor, and for this there must be certain guarantees and an unspoken condition that Bitcoin has some liquidity.
When the demand is growing, and the supply does not keep up with it, the rate rushes up, when someone throws a large batch of Bitcoins on the market, the Bitcoin rate falls.
For example, if investors decide that Bitcoin Cash is better than Bitcoin and start investing in it, the price of Bitcoin will fall significantly.
The Bitcoin exchange rate, like many cryptocurrencies, is influenced by many factors - the economy, politics, and natural factors. For example, the fall of Bitcoin in January 2018 is associated with the fact that the Korean authorities banned trading Bitcoins on the exchange.
The price of Bitcoin can also rise or fall from the calendar date. For example, many experts believe that Chinese Bitcoin users withdraw money to buy gifts for the New Year and celebrate the Chinese New Year, it lasts 2 weeks from February 16 to March 2, so the Bitcoin exchange rate falls at this time, and then it can start to grow.
As a rule, the price of Bitcoin rises on the expectations of investors and good news and falls when they try to introduce restrictive measures against Bitcoin, when new financial laws against the use of Bitcoin are being prepared.