As somebody with a trading background, the market dynamics of bitcoin are a constant fascination. It is still a young currency and the market has therefore spent the last few years searching for a true value, or rather a price that reflects that value. Unlike with, say, the Euro when it was launched, it is a currency whose issuance and supply is modeled on commodities rather than conventional currencies. The limited supply and increasing difficulty of mining should, depending on adoption rates, result in a fairly predictable upward path over time. That price instability should, therefore, in theory not last too long.
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