Bitcoin has always experienced rising and falling in price, and that confirms the truth about the volatility of the Bitcoin currency. The increase in the value of Bitcoin can be traced to certain factors, and we shall see them below.
Investors make decisions based on certain psychological factors which include intuition as well as the market performance of various key components. Good media coverage has proven to be instrumental in the increase of Bitcoin’s value. This contributed to the fast success of Bitcoin in its early days as reports of an alternative currency began to hit the waves. The effect of positive media reviews cannot be overlooked when it comes to the appreciating value of Bitcoin.
The influence of national politics also contributes to making Bitcoin more valuable. Take for instance, during the Brexit, the political situation surrounding the European Union led to the fall in the value of the British pound while Bitcoin soared in value as more people bought into it to secure their riches. Uncertainties in a country’s politics can lead to the rise of Bitcoin’s value.
The regulation of Bitcoin is something that is spread across the nations of the world. These bodies make decisions about the taxation of Bitcoin and also create the right regulations for the currency. For instance, when Japan announced the inclusion of Bitcoin as a legal tender of their country, over the next 24 hours of the announcement, the value of Bitcoin increased by 2%, and in the following months, it rose to 169% all over the world.
The constant use of Bitcoin will bring about an increase in its value. When people around the globe adopt Bitcoin on a large scale as a suitable choice of exchange, Bitcoin will enjoy a rise in value. In addition, when people begin to adopt Bitcoin as a means to store value, Bitcoin’s value will also move in a positive direction. They are all connected, the massive adoption, medium of exchange and value storage. If there is no widespread adoption of Bitcoin, people will not consider it an adequate choice of exchange which will, in turn, affect its storage value. Therefore, the massive adoption of Bitcoin all around the globe will cause an increase in the use of Bitcoin and its value in effect.
Bitcoin increases in value by the working together of several factors. When a nation approves its use, it causes a global ripple effect that creates a surge in the value of Bitcoin and also encourages many people to make use of it. Once a lot of people can be encouraged to adopt Bitcoin as their means of exchange in buying and selling, its utility will be increased and Bitcoin will definitely become more valuable in the world. We might not be there yet regarding a global adoption of Bitcoin as some countries have banned its use within their borders, but as time progresses, Bitcoin will definitely attain the level of global adoption, thereby increasing its value more than ever before.