As you know, the price of any asset is affected by the balance of supply and demand. Stocks, bonds, futures; gold, wheat, bananas; currencies or cryptocurrencies - it doesn't matter. If for some reason they are bought more than they are sold, the price increases. If the situation is the opposite it falls.
But then the question arises - what influences the desire to buy or sell? And who are the people who are able to influence the price in a significant way?
Each asset has its own features. Bitcoin is no exception.
What affects the price of Bitcoin
Bitcoin is interesting because it is inherently not as much a currency as a commodity, since it has producers (miners) and its production is quite expensive.
In addition, the so-called deflationary model (halving) is embedded in the Bitcoin algorithm, which means that about once every 4 years the profitability of Bitcoin production is halved.
This is somewhat similar to oil production: as oil producers exhaust the reserves, they are forced to work with increasingly hard-to-recover stock. However, Bitcoin, unlike oil, is not a raw material. This means that the downturns of the global economy, and even more so its instability, on the contrary, contribute to the growth of its price. For this reason, Bitcoin is often called “digital gold”, because while gold is used in production, it is mainly a tool for accumulating and saving value, and only gets more expensive over time.
So, since Bitcoin is used for accumulation, it means that first and foremost the behavior of large holders (whales) affects its price.
- Whale behavior
In general, whales, who own most of all produced Bitcoins, do not seek to sell them, but only slowly buy more during local drawdowns. However, the rich have their own quirks, and even whales sometimes have mood swings and may shift into other segments, throwing large volumes of Bitcoins on the market. This can lead to significant price fluctuations over a short time, after which a period of calm comes again, and the price finds a new balance or returns to the old one.
- Actions of the regulator
SEC, the American regulator, has recently been trying especially actively to influence the cryptocurrency agenda with varying degrees of success. Gary Gensler's desire to bring all crypto assets under the securities law makes the market fluctuate a lot, because it is never clear how this may end. However, the crypto community position is quite strong, and the SEC's defeats in SEC vs. Ripple and Grayscale vs. SEC is proof of this. Nevertheless, the SEC does not intend to give up, and the fight continues.
- State policies
In this case, we are talking about the leading states of the crypto industry. Everyone remembers China’s ban, when in the summer of 2021 Bitcoin fell from 60 to 30k in a month. However, this can be considered an exceptional event, so state policy should not be put first - such “turns” are unlikely in the current reality since large economies seem to have already decided on their position on crypto assets in general and Bitcoin in particular.
Elon Musk remains one of the main opinion leaders in the cryptocurrency sphere. So, in the fall of the same 2021, he suddenly announced that he was dissatisfied with how Bitcoin affects the environment. After that, Bitcoin again proceeded to the 30k zone, shortly before rewriting the absolute maximum around 70k.
In fairness, it is worth noting that Musk's tweet should be considered the last straw rather than the first sign, since the market at that time was already so overbought that Bitcoin had practically no chance of further growth.
Institutional players, that is, large companies interested in Bitcoin, began to enter the game at the end of 2020, when it was already clear that Bitcoin is a serious asset and will be around for a long time. The apotheosis of this movement was the SEC's approval of the first ETF for Bitcoin futures at the end of 2021. Then the unshakable “sell on facts” worked, and then Elon Musk arrived in time - the market went down to the next wave of general enthusiasm.
- Ordinary users
Today, ordinary users are practically unable to influence the price of Bitcoin, since their volumes are incomparable with those of large players. However, the classic picture of the end of 2017 will forever remain in history, clearly demonstrating what the inspired masses are capable of. Nevertheless, there will always be whales for every surge in retail activity, which sooner or later will stop the enchanting growth with a painful sale.
And yet, you should not discount ordinary users. After all, no later than at the beginning of 2021, it was they who, united in the Reddit community, accelerated the garbage shares of the GameStop video game store by more than 800% in just a month!..
- And finally, the MINERS!
Bitcoin miners are a special category of users. The last place in this list is assigned to them not by significance, but by the totality of all of the above factors. After all, miners can be whales, regulators, states, and, of course, opinion leaders, institutions, and ordinary users. All of them have one thing in common - they spend the mined Bitcoins to pay for their production, mainly for electricity. And that’s a lot of money!
Today there is a special category of miners, large mining companies, whose steady increase in mining capacity leads to an increase in the hashrate and difficulty of the Bitcoin network (the cost of Bitcoin is growing). On the other hand, these companies are usually very heavily burdened, and in order to pay off debts for active purchases of mining hardware, they are forced to sell a significant part of the mined Bitcoins, thereby reducing their price.
This is an extremely interesting and risky process, since any significant crisis will bankrupt these companies, and the market will be more shaken up than after the Chinese ban. However, it is all the more interesting to observe how companies like Marathon, Hut8 or Riot will behave on the eve, during and after halving.
So, we have counted 7 key factors affecting the price of Bitcoin.
Now let's look at what affects the price of the BTCMT token, thanks to which ordinary users can mine Bitcoin by investing directly in its hashrate.
What affects the price of the BTCMT token
BTCMT is a token of the Minto project, tied to Bitcoin hashrate in proportion of 100 BTCMT = 1 TH/s. The BTCMT token is also a commodity in its own way, because every time another section of the mining farm needs to be put into operation in order to produce new tokens.
The Minto project regularly adds hashrate. So, recently the mining power has been increased from 73 to 78 PH/s, which means that the Minto mining farm has been supplemented with new miners with a total hashrate of 5,000 TH/s.
So, what influences the price of the Minto token?
- Whale behavior
Yes, Minto has its whales. Their volumes are incomparable with the volumes of Bitcoin whales, however, if a Minto whale decides to replenish its reserves, the price rises sharply, and if it arranges a sale, it falls. However, looking at the BTCMT chart, you can note that all sales are bought out very quickly by other players.
Fortunately, regulators and states do not affect the price of BTCMT in any way just yet, because our project is not large enough to excite their imagination. Therefore, paragraphs 2 and 3 are irrelevant.
Influencers and institutions (p.4 and p.5) haven’t been noted to have any impact on our project yet. However, it's worth admitting that if Elon Musk suddenly writes in his Twitter account - it's time to buy Minto! - we will take off quicker than DOGE or SHIB.
- Ordinary users
The Minto project was created for ordinary users who are miners at heart, despite the fact that the entrance to this market has long been closed off for them due to the expansion of large mining companies. The Minto project works for crypto industry enthusiasts, romantics, students, intellectuals, seekers of all fascinating things and just good people, offering them a simple way to engage in Bitcoin mining.
This does not negate the fact that we are certainly open to large capital - the more BTCMT tokens are sold, the faster we will build data centers around the world, and the more all our users will earn. So, we welcome everyone who is not indifferent to mining - we’ve got something for them!
The Minto team continues to develop the project, as you can regularly see from our posts and news. It is in our power to make sure that this movement does not stop, and all our efforts are appreciated by ORDINARY USERS - our kindred spirits, which, in turn, will lead to an increase in the price of our main asset - the BTCMT token!