Bitcoins are transacted on an ongoing basis and around the clock. About 62,000 Bitcoin transactions are conducted daily with an average volume of $50mil per day.

Transactions over the Bitcoin network do not directly affect the market price of Bitcoin. In the sense that an active Bitcoin network reflects a healthy protocol enjoying plenty of usage and demand, there is an indirect influence. Only where bitcoins interface with other currencies – at exchanges – is there a direct impact on the price of Bitcoin. And that impact responds to supply and demand just like they taught you in basic Economics


Buying Bitcoin from an exchange

Every bitcoin exchange transaction that involves the purchasing of bitcoin via another currency, whether fiat or cryptocurrency, has the effect of pushing the bitcoin price up. Because the bitcoins are changing hands – from the exchange’s wallet to the buyer’s wallet – there is an accompanying Bitcoin network transaction. However, it is the exchange transaction that counts toward an uptick in the Bitcoin exchange rate. Routine purchases are made daily, for various purposes, and typically increasing toward month-end:

    Company salaries
    Wallet balance replenishment
    Buy-and-Hold investment purchases
    Incidental purchases destined for paying merchants
    Purchases intended for transmission



Selling Bitcoin to an exchange

Every exchange transaction that involves the selling of bitcoin, i.e. exchanging for fiat or another cryptocurrency causes a downtick in the price of Bitcoin. Let us consider the last example listed above, namely usage of the Bitcoin network as a means of money transmission.

Someone working in the US, and paid in US Dollars, wants to send money to their family in Zambia. Instead of using the illustrious Western Union, they opt for the Bitcoin payment network. No queues, no forms to fill in, no proverbial rubber gloves, and no extortionate fee. They purchase bitcoin via an exchange that offers BTC/USD, send the bitcoins to a relative’s Bitcoin address, and 30 minutes later the relative in Zambia redeems some (or all) of the bitcoin for Kwacha via a local exchange offering BTC/ZMK.
 


Comments

03/20/2017 8:11am

I don't understand the things related to the biology. I must say this blog would be helpful for the students of biological group. I hope you will keep sharing such things continuously.

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03/25/2017 5:11am

My brother had explained to me the function of bitcoins. I have also done some research about it. It's a cryptocurrency. It's represent money in the world of internet or something like that. It needs to be replenished to continue a smooth processing transactions. It has always confused me because I have never used a bitcoin in my life. I hope someone explains it further so I can have a better understanding about it. Thank you very much for sharing this!

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07/06/2017 11:43pm

The fluctuation of bitcoin pricing is quite alarming. I can see that bitcoin is being transacted fastly nowadays. Is this because of the fluctuation situation of bitcoin? I am surprised to read this because I haven't been updated about bitcoin pricing for a while now. Please keep posting mroe about this topic.

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07/21/2017 10:38am

Many thanks for getting enough time to discuss this, They have been a giant help for us. Thanks a whole lot.

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08/10/2017 4:03am

Bitcoin engages in a peer-to-peer payment system where no intermediaries exist and goods can be securely transferred between any two people on the planet. This article is about the upside and the downside of investing in Bitcoin.

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