Why is Bitcoin Price So Fluctuating?

[xianbits]

If you are an active trader in the world of digital currency and indeed take advantage of extreme price movements Bitcoin to seek profit, Bitcoin prices are fluctuating, of course, brings its own happiness. But it's different if you use Bitcoin as cash or fiat money. If you redeem your one million Bitcoin and intend to spend it on an online site, you certainly do not want your Bitcoin value to decrease as Bitcoin prices suddenly drop. Bitcoin you have now cannot pay for the Hard Disk 1 Terra you want and eventually, you have to buy extra Bitcoin to cover up the shortcomings.

Fluctuating Bitcoin prices have become a daily complaint of Bitcoiners around the world. Actually what factors affect the rise and fall of Bitcoin prices?

Well, it's not all the Bitcoiners are complaining about the fluctuating prices because as you said, traders are taking advantage of it.
And about your question to what factors affecting it, it mostly the traders themself. It falls on the supply and demand same as how commodities' prices increases when the supply is low or the opposite. FUD mainly affects the demand but I think it must be the "bitcoin uses" that should be affecting it.

[soham]

If you are an active trader in the world of digital currency and indeed take advantage of extreme price movements Bitcoin to seek profit, Bitcoin prices are fluctuating, of course, brings its own happiness. But it's different if you use Bitcoin as cash or fiat money. If you redeem your one million Bitcoin and intend to spend it on an online site, you certainly do not want your Bitcoin value to decrease as Bitcoin prices suddenly drop. Bitcoin you have now cannot pay for the Hard Disk 1 Terra you want and eventually, you have to buy extra Bitcoin to cover up the shortcomings.

Fluctuating Bitcoin prices have become a daily complaint of Bitcoiners around the world. Actually what factors affect the rise and fall of Bitcoin prices?

Like the real-world stocks, bitcoin's price is based on the public trust and sentiment worldwide. Where stocks are mainly country specific so it is easy to speculate on that. But bitcoin is an international asset and hence it is not easy to guess the public sentiment towards bitcoin. There is no specific factor behind the bitcoin price fluctuation so I won't be able to tell you about any single reason.

However, if you see that a big financial company is talking ill about bitcoin, then you can expect the price may go down a bit. On the other hand, if you see a country is giving out licenses to a bitcoin exchange or legalizing it, the price may go up. But these are all general assumptions. There is no rock-solid factors behind it.

[HabBear]

the market cap is too small

as the market cap grows, it will take much more to move the price

That is not the only reason. Its market capitalization is more than $70 Bn. There are a lot of companies who aren't valued at those levels. Still Bitcoin is much more volatile.

Market cap doesn't even drive price. Market cap is a consequence of price. Market cap is not a reason why the price fluctuates.

I don't think Prince8 argued that market cap is driving the price. I think his point is that the larger the market, the more money it takes to move (or manipulate) the price in a meaningful way. Buying / Selling USD 1 million worth of BTC now has a lesser impact on the market than it would have 2 years ago.

Oh, yeah, that's a great point. I suppose that also means as Bitcoin becomes more widespread as an investment there is less money "on the sidelines" available to be invested AND each new dollar (as you say) doesn't have the same impact on price as the dollar before it did.

[Anfisman]

Currently the bitcoin price movement very volatile and very difficult to predict, but it makes traders take advantage from it to make a profit. But this highly volatile price is still complained by bitcoin hunters around the world. I think there are two things that affect the price of bitcoin, including:

1. Small volume of scattered bitcoin
Bitcoin prices are determined in absolute terms by supply and demand. If many buy Bitcoin, then the price will go up and vice versa.
2. The sale of bitcoin on large scale at the same time
when the price of Bitcoin increases, then most people will sell their Bitcoin and if this happens simultaneously and involves many people, the bitcoin price will drop again.

and there are still many other factors affect by bitcoin prices.

[kevindjunaidi]

because bitcoin is the same as gold or stock, every time can change but bitcoin is more profitable and promising for the future, because bitcoin price increases so rapidly compared to gold and stock, so if you want to invest in the future better bitcoin even though bitcoin price fluctuating , but bitcoin prices more often than decreased.

[Capt00]

A lot o factors affecting its price in the market and we can't control its fluctuation.
Supply and demand are the 2 major factors that could contribute a lot on its fluctuation. Because bitcoin have only limited supply in the market  but it is highly in demand because of many investors are getting in, that could affect the price and it goes up.

[Images21]

I guess the major factor is still the most basic of all, that is, the supply and demand. It is the most determining factor in any asset which is being traded. Once the demand rises, the value will also be rising. But once the demand dwindles down, it will be expected that the value will also decrease. But aside from this very basic factor, I am considering the whales' manipulating moves as well as FUDs, and other crypto news and development. 

[dindasulis]

If you are an active trader in the world of digital currency and indeed take advantage of extreme price movements Bitcoin to seek profit, Bitcoin prices are fluctuating, of course, brings its own happiness. But it's different if you use Bitcoin as cash or fiat money. If you redeem your one million Bitcoin and intend to spend it on an online site, you certainly do not want your Bitcoin value to decrease as Bitcoin prices suddenly drop. Bitcoin you have now cannot pay for the Hard Disk 1 Terra you want and eventually, you have to buy extra Bitcoin to cover up the shortcomings.

Fluctuating Bitcoin prices have become a daily complaint of Bitcoiners around the world. Actually what factors affect the rise and fall of Bitcoin prices?

well,The price of everything fluctuates is like US Dollar, price of gold, stocks, bonds on an on. The question is why does Bitcoin price fluctuate so much? The answer is because the price of bitcoin has no underlying basis. The price of stocks can be related to the underlying value of the firm they represent. In the case Of course supply and demand determines price, price being basically where the supply and demand curves intersect. What makes the price go up and down is that the slope of these curves (and hence the point where they intersect) changes depending on the market environment of bitcoin.
so the point is  supply and demand. Volume. Just like stocks. It's identical to how stocks work. If a large volume is sold, the price (value) drops. If a large volume is purchased, the price goes up.
There's are some minor outside factors but trading and speculation are the main reasons.

[Karimeen]

          The bitcoin price is so fluctuating due to the high volume of speculation in the market. For a sensible trader it is always good such speculative market to earn money. Normally the price of a commodity increases because of the market demand .Here the supply of the bitcoin is constant meantime if the demand still increases naturally the price has to go up. In the speculative market if the buyers are more bitcoin price will increase meantime if the sellers are more price can be decreased.

[RayvenPierre]

The supply and demand are what causes the price of the bitcoin to change. For example there has been a negative news regarding bitcoin which causes people to do panic selling. This will result to a excess amount of bitcoin being sold which will cause the price to decrease. As the supply increases the price decreases.

[patrickj]

Maybe when some issues or news comes up by they affect the rise and fall of bitcoin market. Like the hardfork in August 1st, many was panicking to sell their bitcoin so the price gotten dump then after a successful hardfork it incredibly pump at highest price. After several weeks, another news affects the market, the Chinese banned issue but now it suddenly up little by little and this may continue until no new bad issues will came. Hopefully the price will not go down less than $4000.

[deadsilent]

We see bitcoin and other cryptocurrencies fluctuating is because of the demand and supply. That's how it works mate. The higher demand but lower supply, the higher the price of a product. The lower demand and the supply is too much. It will cause the product drops it's value. That's the Law of demand of supply. Demand and supply cause cryptocurrencies to fluctuate. The market still not solid and can easily collapse and it's still under developed. In additions for this are the news against this technology. It could affect its price depends on how bad the news as people are relying to much on news. That's why we experience fluctuations too often. Like the recent price drop. It's because of continous crackdowns on bitcoin. Let's wait and see when the market grows as big as stock market. Crypto market surely will surpass the stock market. Right now, the market is still young and a lot of issues about legality. Many countries still considered this as a fraud. But some change their minds. Like Russia. Let's wait for the others to adapt this technology.

[hari9981]

I think the bitcoin price is influenced by the large bitcoin demand. if the demand for bitcoin becomes large then bitcoin prices will continue to rise. otherwise if the bitcoin price falls, as the demand for bitcoin decreases. or many people make sales.

[Yessha]

Price fluctuate based on the supply and demand  in the market which also  influence and affects the foreign currency. The higher the demand may result in shortage of supply which cause the price to become higher. Now, its already affects the market trend the tendency of some businesses is to add on their supplies. If the supplies become higher and the demand will be lower the market will be force to lower their price unless they have some awesome strategies to attrack more on their business.

[bololord]

There are several factors. The most obvious is the volume of demand both selling and buying. Then, good news / bad about Bitcoin that will make the price fluctuate.

I agree to you , buying and selling coins makes the bitcoin flactuate or we the bitcoin is volatile maybe  in bad news and other news about bitcoim so that's why the bitcoin naturaly to decrease and increase on it's own value.

[notyours]

This is because of continued buying and selling. Sometimes the price of bitcoins is rising because more buyers are buying. Sometimes more sellers also fall in price. And this really affects the price of bitcoins. Just explanation is why falling and rising / Flactuating

[cyberChevan]

If you are an active trader in the world of digital currency and indeed take advantage of extreme price movements Bitcoin to seek profit, Bitcoin prices are fluctuating, of course, brings its own happiness. But it's different if you use Bitcoin as cash or fiat money. If you redeem your one million Bitcoin and intend to spend it on an online site, you certainly do not want your Bitcoin value to decrease as Bitcoin prices suddenly drop. Bitcoin you have now cannot pay for the Hard Disk 1 Terra you want and eventually, you have to buy extra Bitcoin to cover up the shortcomings.

Fluctuating Bitcoin prices have become a daily complaint of Bitcoiners around the world. Actually what factors affect the rise and fall of Bitcoin prices?

Bitcoin is decentralized, no entity controls its price. Because of this, Bitcoin depends on the law of supply and demand to formulate its current value. Any event that can affect the demand will definitely affect the price. Selling Bitcoin to an exchange will increase the supply available in the market, buying Bitcoins will increase the demand and lessen the available supply in the market. Such event will affect Bitcoin's price. If we consider other factors such as FUD and rumor spreading, banning and acceptance, it will be difficult for us to predict how the price will move.

[sdas90]

I think there are no main reason, bitcoin price so fluctuating. but something  depend on demand and market exchange . recently, one of the most reason Chinese market exchange ban, that's why price fall down.

[erickkyut]

The price of Bitcoin is always fluctuating because it the depends on the Law of Supply and Demand. If the Supply is high, the demand is low and if the demand is high, the supply is low. Whenever there is a high demand, the price is increasing because the supply is limited. Aside from that, another factor that can affect Bitcoin price is the current news about it. If there is good news, people tend to panic buying and if there is bad news, they do panic selling.

[DoublerHunter]

The price of bitcoin is always fluctuating because the price of bitcoin is always depending on the demand of the people in the market. So if you are going to invest in bitcoin then expect price changes because people are always depending on the news about bitcoin so it is about emotion so that is another reason why the price of bitcoin is always fluctuating.