Bitcoin Forum

What determines the value of a cyrptocurency is trading. But one thing I would like to know is that, sending and receiving currencies among wallet holders, is it the same thing as trading? does it add up or down to the value of the cryptocurrency? Thanks

Hello,

When you trade, you "consume" the buy wall. If there is no more buy offer versus 500$ (example), the value decline.

In a transaction, you don't trade your BTC for another currency, so there is no change in value. A transaction is a bit like a sell versus nothing. OFC if it's for buying goods, and if the seller will automatically sell the coins, you will help to reduce the value.

We can go deeper : As your transaction requires fees, and because you pay the fees, you will pay the miners. These miners can dump the coins they got in the fees in an exchange, so you can by this way reduce the value  ;D

But as transaction fees are really small, this doesn't change anything in fact.

no trading is different when you trade you sell or buy for something else, you don't send just to another wallet, you sell yoru coin to get bitcoin, simply sending a transaction is just moving your coins

Thanks to everyone for the response. But, lets look it this way, when Bitcoin started, there was no other cryptocurrency to trade with it, yet its value increases. Is there any answer to why its value increases then without trading it with another coin?

It took a few years to give the first value for a btc.

BTC value depends mostly of confidence in the system, good or bad news, adoption, these kind of things. Trading is a bit a cause and a result too. Adoption and confidence was the first thing that helped Bitcoin to increase its value, it didn't started by trading, anyway during the first years.

In my opinion that affect the price of crypto is the number of enthusiasts who use the crypto, different trading is buying and selling btc to altcoin or the other in one exchange, while the transfer balance using 2 exchangers wallet the sender and receiver and can also affect the price of crypto. Have you ever heard about arbitration?

There was the dollar (and other governmental currencies) to trade it with. At first people weren't willing to spend much money on a digital currency, so Bitcoin was pretty cheap. Then once more people started getting interested in it, price rose due to the rising demand vs a diminishing supply.