The price of Bitcoin is dependant on supply and demand. The price of bitcoin fluctuates on basis of the intensity of both supply and demand. The supply of Bitcoin is quite predictable and has a stable drop down given that it block rewards are halved every four years. However the demand of bitcoin is quite unpredictable and un-capped which makes it subject to fluctuations based on the difference in demand.

This difference in demand is lead by various events and occurrences that target huge market. Anybody that buys, holds or sells bitcoin is a reason for the price of bitcoin to fluctuate. The number of people involved in this ordeal increases randomness or entropy which means that the price of bitcoin is subject to the activity of so many people than we don’t normally think of.

Anytime prices are stable, it is mainly because the entropy or randomness is reduced. This reduction of randomness is mainly because of the demand in the bitcoin market has reduced. This does not mean that people aren’t transacting with bitcoin anymore but that people buying or selling have a lesser margin between transactions.

Here’s a great article to describe what drives the price of Bitcoin:
Why is there a difference between the actual Bitcoin price and the buying and selling price?

We tend to feel that the price of Bitcoin is stable because of reduced entropy between the people buying, selling and the ones creating value.
However the price of bitcoin is always fluctuating and the reduced entropy means lower price differences in the price of Bitcoin.

Here’s a video that I think helps:


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Posted by Min Park

Blockchain Marketing Specialist / ICON ($42M) / MediBloc ($25M) / BOScoin ($12M) / PAXchain ($60M) / Krown Media / :0

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