Bitcoin Forum

I understand putting money into bitcoin to avoid using banks but how does a digital currency increase in value?

Rule of Supply and Demand. The more people purchase Bitcoin, the higher its value. When people are selling, its value drops. Exactly how corporate stocks rise and fall within the Stock Exchange.
Hope this helps!
 ;)

How does anything have value? It's simply a matter of what someone else is willing to pay for it.

There's no corporate report on annual gains with BTC, so it does not rise and fall in the same way.

@
TheQuin

Nicely said - I double that! Basically, all commodity values as well as the value of both the Crypto as well as Fiat currencies are basically a lie - something fake!
It's the people that deal with them that add or subtract value.
For example, if everyone starts avoiding using the USD$, its price and value will plummet...
The same may be said with OIL, Corn, Coffee and so on...

Perhaps, but what if the relation people have with money as a medium of exchange (MoE) is corrupted: "bad money drives out good in any marketplace" Vs. "Central banking is based on the principle that no medium needs more than the guarantee of the state that it can be redeemed for payment of debt as "legal tender" – thus, all money equally backed by the state is good money,"

You are right. But in general, the rule of supply and demand is what drives prices up or down when it comes to basically everything!

Look at what happened to the prices of certain Graphics Cards due to mining for example; Cards that previously sold at almost half the price! The cost of production didn't change (in fact, it dropped due to the increase in production numbers), the number of retailers didn't change (basically), nor did the specification of the cards changed.
Report or no report, prices are driven up or down based on the value that people place on an item / commodity / currency by their demand.

may be you must take this thread on the discussion forum sir.