How is bitcoin price determined reddit

The value of Bitcoin (BTC), unlike traditional fiat currencies such as the Euro or the U.S. Dollar, is not determined by a centralized authority like a central bank.

Instead, Bitcoin’s price is determined based on supply and demand. Bitcoin has a supply cap where no more than 21 million BTC will ever exist.

Btc price usd

Bitcoin’s price increases when demand exceeds supply and decreases when demand falls. Other factors such as the cost of producing bitcoin through mining, regulations, news, and competition from other cryptocurrencies can influence the supply and demand and thus, influence the bitcoin’s price.

The price volatility of Bitcoin has left many skeptics questioning the mathematical and economic basis of price movements while searching for a generalized justification for its valuation.

Since Bitcoin is decentralized, it doesn’t follow the monetary policy of governments, and Bitcoin is not backed by any underlying asset or government. This creates skepticism among investors and consumers who appreciate the price stability signals

how is the value of bitcoin established

how bitcoin value is decided