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Understanding the Key Factors Driving Bitcoin Trading Prices

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Bitcoin is the world’s first decentralized cryptocurrency. Bitcoin trading is a fast-paced and high-octane way of making money. It is also usually traded on a short-term or mid-term basis. In this market, traders follow news, events, and market activity at every hour of the day to look for indications that the prices of Bitcoin may change.

The main aim of best bitcoin trading platform is to purchase bitcoin when its price is low and sell it when its price is high. In simple words, buying bitcoin at a low price means that a person pays a low amount of fiat currency, such as dollars or euros, for a high amount of bitcoin. On the other hand, selling bitcoin at a high price means you obtain a large amount of fiat currency for a small amount of bitcoin. Also, the volatility surrounding bitcoin trades constructs the possibility of making a high turnover.

Evolution of Bitcoin 

Bitcoin, a white paper concept, was established by Santoshi Nakamoto in 2008 at the time of Halloween, which classifies itself as a peer-to-peer decentralized virtual currency. Bitcoin is a revolutionary concept that promises to shake the security and solidarity of transactions in the financial world. This is because there was no involvement of central authorities like the government or central banks; it was easier for the traders to buy and sell the assets within a couple of minutes.

Bitcoin was bizarre as its founder Santoshi Nakamoto intended it to be the future of money. Although the idea was excellent, the timing was perfect because when this concept was introduced, the world was in a global crisis triggered by financial liberalism. As a result, it intended to make a positive impact in the future.

Earlier, when Bitcoin was launched in 2009, the value of $1 was corresponding to over 1,300 Bitcoins. And now, as time passed by, the value of the same amount of Bitcoin has surpassed $20,000. Therefore, Bitcoin and other cryptocurrencies hold a lot of potential in investors’ portfolios. However, investors who had invested late saw an underdog market booming in 2018. After that, the Bitcoin and cryptocurrency market became mainstream for trading and investing and gaining a handful of profits as quickly as possible.

Nonetheless, in 2020, when the coronavirus hit the whole world, the economy around the world was shattered to ground level. However, as every digital economic currency was falling off, Bitcoin and other cryptocurrencies sprung to an extent. Bitcoin had proved to be the ‘digital gold’ when the value of everything was low. The market value of bitcoin rose from $4000 at the start of the year to $23,000 in December. In that year, when the investor’s portfolios suffered the effects of the coronavirus, Bitcoin returned as a cure to them.

Later on, the year 2021 was a blockbuster hit for the cryptocurrency industry, especially for Bitcoin. Bitcoin’s price movements rallied above $55,000 in February itself, and at the same time, news came in that Tesla had bought $1.5 worth of cryptocurrency. As a result, Bitcoin continued to get upward and reached $60,000. After that, however, a negative regulatory crackdown in the UK and China pulled back the Bitcoin price movement to $30.000.

Further, Bitcoin was being considered a legal tender, and a blockchain-related company Amazon saw a bang in the market and started supporting and accepting cryptocurrencies as a payment method for their listed products. As a result, this Bitcoin blockchain method took an all-time high of $ 70,000 in November 2021. But later, in 2022, the negative regulatory crackdown in the UK and China caught fire, and the price movement of Bitcoin went down to $30,000 in May 2022. Due to this market fluctuation, Bitcoin impacted the investor’s confidence to invest further and the trading process.

Key factors that drive Bitcoin prices

Essential elements that drive the Bitcoin prices:

1. Risk-taking yearning 

2. Technical analysis

3. Guidance about the market

  1. Risk-taking yearnings – Though Bitcoin is the most profitable cryptocurrency, it abides more profits than losses. But the risk factor is also the same; the ratio between facing profit and loss in the bitcoin market is relatively equal. Instead, other cryptocurrencies have far fewer risk assets. As a result, Bitcoin only sometimes acts as a safe house of assets; rather, its price value volatility furthers an investor’s trade confidence.
  2. Technical analysis – technical analysis does not require dozens of markets to work. Bitcoin trading takes place in multiple traceable and untraceable exchanges, which makes it difficult to determine the exact pricing of an asset at any given time. As a result, investors consistently lay charges on market makers for manipulating price movements. Due to this trend-following, technical analysis is an essential tool in tracking the self-fulfilling predictions of Bitcoin price movements.
  3. Various online mediums – Cultivating correct information through online mediums also plays an essential role in popularizing the cryptocurrency market. Due to this, it builds up an investor’s confidence in the latest technology-based mediums, which results in the upliftment of price movements and gaining profit for the overall market. Although, a trader should follow their instincts and follow the path whether it backfires or not.

Following steps on trading Bitcoin –

  1. Opening a Bitcoin CFD trading account
  2. Constructing a trading plan
  3. Analyzing the market performance
  4. Sharpening your risk management skills
  5. Keep an eye on your holdings and positions

1. Opening a Bitcoin CFD trading account – Creating a CFD account is the most straightforward and reliable process. After opening a bitcoin trading account, it is necessary to cash in the digital wallet once a trader is ready to start trading.

2. Constructing a trading plan – This is the most crucial step; whenever a trader needs to start trading in any market, they should have some strategies planned for gaining a good profit and tackling the market’s volatility. One of the main tactics is to plan how much capital a trader can raise, keeping in mind the risk-bearing component. For example, if you do not feel confident about putting in a high amount sensing the risk, it is all right to deposit a minimal amount on which you can lay risk if that does not turn into profit.

3. Analyzing the market performance – Before investing or trading in any market or asset, a trader should have looked at the previous market graphs on how it has been performing and figured out if it’s worth investing in or trading. Also, a trader can connect with the brokers for a better understanding of the graphs on how it works.

4. Sharpening your risk management skills – Bitcoin or any other cryptocurrency contains a very high risk due to market volatility. To overcome these risks, a trader must pursue some risk management skills. For example, keep looking at the market if you have invested a handful of money in an asset and are underconfident that it will rise. If you do so, you will see the price value demeaning; that’s when you sell your Cryptocurrency immediately.

5. Keep an eye on your holdings and positions – after creating an account and starting with trading, a trader should keep monitoring the positions and holding of the assets being traded. This process is essential as the market is volatile, and price movements get up and down. To prevent less risk or gain good profit, they must buy and sell the commodities at an appropriate time.


Bitcoin’s trading history as a store of value has always been unstable, and it has gone through several boom and bust cycles over a while. Although, after fluctuating, traders rely on this market as it has a lot of profit-making potential, which settles the risks simultaneously. However, it is advisable to invest in Bitcoin, passing over its pros and cons as it has been reliable for a long time and holds the pleasure of being the most trusted and the first cryptocurrency in the market to change the future trading and investment habitat.