Bitcoin Market: General Information

A market is a network of buyers and sellers (of shares, stocks, or assets). It does not refer to a place, but rather to a system of buy or sell transactions. In other words, a market is an environment in which such transactions occur. In this case, Bitcoin market is the total number of offers available at a given period of time.

Bitcoin market cap: A definition

Another important concept is market capitalization, which refers to the total value of all the outstanding coins, or coins available for trade. It is more often called ‘market cap’. You can see the Bitcoin market cap at Blockchain.info or at Bitcoinity.org with the graphs showing all the coins available for buying and the coins available for selling. The similar statistics for all cryptocurrencies can be viewed at the Crypto-currency Market Capitalizations website with coins sorted by their market cap by default.

The players in the market

Traders are the main players in the market. Moreover, they are the necessary condition for the market to exist. In the case of Bitcoin, they act as one of the key factors which define the value of the currency. There are Bitcoin market makers and takers who, respectively, provide the liquidity to the market and those who take it from the market.

Bitcoin exchanges as traders’ playground

For these two groups of traders to be able to move the liquidity (Bitcoin), there has to be a specific place. Bitcoin exchanges play a very significant role in the circulation of stocks or tradeable assets. An exchange can be defined as a place where the transactions between buyers and sellers occur.

The main processes: Buying and selling

The main activities which happen within the boundaries of a Bitcoin market involve buying and selling. This happens on exchanges where orders are placed and the prices are quoted. Circulation of Bitcoins on these exchanges defines the daily volumes of trade which affect the reputation of a particular exchange. You can always look up the market volumes of Bitcoin on CEX.IO Trade page.

What’s behind the market processes?

On the background of the Bitcoin stock market, there is a variety of other processes which determine the price and define the supply and demand. By supply here, we mean not the limited existing amount of coins, but the amount which traders are offering for purchase. The price of any cryptocurrency is extremely volatile; it can change significantly within minutes, and a range of factors can facilitate this. For example, the news surrounding Bitcoin – positive media coverage and big events can make the price fly.

What Factors Control the Price of the Bitcoin?

Using Bitcoin Price Volatility

Bitcoin-related volatility and risks

Wherever Bitcoin is, risks are involved. As any other cryptocurrency, its market price varies. For many traders out there, however, such risks seem rather attractive than repelling. Volatility means that, once properly predicted, the price can benefit the financial well-being of a person who buys and sells. The potential of price increase makes Bitcoin a luring investment.

The Bitcoin price predictions

Because of the risks and ambiguity associated with Bitcoin and other cryptocurrencies, most players are constantly trying to make predictions regarding the price of this crypto. The permanent observation of the news and the price charts may help traders to come up with predictions of various accuracy. Technical analysis is a powerful instrument of every trader who wants to make some money on the crypto price fluctuations. While we at CEX.IO blog provide from time to time some tools and knowledge that might help understanding the price trends (for example, see the article on trading fundamentals, or the one on how to read charts), there are other options as well to use the prediction skills in the Bitcoin stock market.

Bitcoin prediction markets: What’s That?

Bitcoin prediction markets haven’t always been here. They emerged when the realisation of this extreme volatility in the price became evident and acute. In late 2013 and early 2014, the Bitcoin community has started to express the need for means that either protect one from the possible losses, or help one earn with accurate predictions. Thus, the user base of betting websites and supporters of futures contracts constituted the Bitcoin prediction markets.

In simple words, prediction markets (in the crypto domain) are market players who are trying to guess the future state of different Bitcoin-related issues, for example, the price of mining contracts. One of the best known applications of the Bitcoin predictions is futures contracts where the two parties agree on a financial transaction which will occur in the future, while the price is agreed upon at the time of making the agreement. You can read more about the futures contracts,  and the article on futures trading is here. In the past, CEX.IO had a practice of using futures trading to sign cloud mining contracts with users.

Bitcoin Markets: The Summary

It does not matter what aspect of the crypto market you are viewing – there are multiple instruments, technologies, and strategies to use. The market is risky because of its volatility; this makes traders search for either the ways to protect themselves from the possible risks or enjoy the roller coaster ride and the possibility to earn. In any case, CEX.IO has been offering everyone a number of ways to use the Bitcoin stock market and the currency’s price to their benefit.