Does Inflation Determine The Price Of Bitcoins: What You Need To Know

Published on: 07 October 2021 Last Updated on: 30 July 2024

2021 has seen a spike in Bitcoin trading. Unlike investing in traditional currencies, Bitcoin is not issued by the central bank or backed by any governmental organizations.

Therefore, the monetary policies and economic growth measurement that typically affect the price evaluation of the fiat currencies don’t affect Bitcoin.

So, if the price of Bitcoin is not affected by the traditional elements, what affects the price of Bitcoin? This is what we will discuss in this article.

Does Inflation Determine The Price Of Bitcoins?

Crypto investors often discuss Bitcoin being a hedge against inflation; why?

The argument starts with the fact that the process of central bank money printing will eventually lead to the decrease of the value of money over time. But, on the other hand, Bitcoin has no connection with limitless printing.

There are a total of almost 21 million Bitcoin that will end up in the market when the reward for Bitcoin Mining reaches Zero. This limited supply allows Bitcoin to resist inflation.

Initially, the concept was only in the papers, but it became a proven fact after the pandemic. When the pandemic hit the global finance market, the government hoped for an expansionary monetary policy, whereby central banks started printing money to make the market stable.

The crazy amount of money printed during the first twelve months of the pandemic increased the inflation rate. Despite the value of the currency depreciating, the price of Bitcoin keeps on rising, reaching an all-time high of more than $63,000.

This further solidifies the argument that inflation does not affect Bitcoin’s Prices.

What Affects Bitcoin’s Prices?

After our conclusion to the argument, one thing is certain: inflation plays no role in influencing Bitcoin’s prices. So then, what factors stimulate Bitcoin’s prices?

The answer may surprise the investors because of what’s not included: Bitcoin Mining.

1. Demand & Supply

Demand and Supply are one of the main factors that affect Bitcoin’s price. The higher the demand and the lower the supply, the higher the price.

As we have talked about earlier, unlike the unlimited supply of fiat currencies, Bitcoin is limited. Moreover, over time it gradually slows down. For this reason, there is a possibility that the demand for Bitcoin will increase in the future.

Of course, the demand of every Cryptocurrency will vary, but that will depend on several other macro factors.

If you are an investor and looking for an opportunity to invest in Bitcoin, the bitcoin equaliser platform might be a better choice. They have experts sitting on the other side of the platform helping new investors understand the new roads of investment.

2. Power Of Media

Information regulation also affects Bitcoin’s price. The way the media writes about Cryptocurrencies largely affects the demand curve. If the media talks about the good aspects of Bitcoin, the demand rises, while bad news can cause panic, reducing Bitcoin’s price.

3. Financial Crisis

The economic situation of the countries also determines the price in that country. If the traditional financial system starts to collapse, people start looking for other assets to safeguard their money’s monetary value. Therefore, the crisis has a close relationship with the economic status of the nations.

4. Rules & Regulation

Another important factor that can be considered equivalent to the demand and supply is the rule and regulation of Bitcoin. Every nation has different rules and regulations that you need to fulfill while trading in Bitcoin or other Cryptocurrencies.

When the rules become quite restrictive to take the repression, the price of Bitcoin falls. But, on the other hand, if the rules are friendly to the industry, it acts as a catalyst for a strong price increase.

The Bottom Line

The factors we have talked about are just the most important ones. There are other factors as well which support the price fluctuation. Therefore, all the investors who are looking to invest in Cryptocurrencies must analyze all the factors. Knowing the factors will help you avoid unwanted risks and increase the chances of profit.

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Mashum Mollah

Mashum Mollah is the feature writer of Search Engine Magazine and an SEO Analyst at Real Wealth Business. Over the last 3 years, He has successfully developed and implemented online marketing, SEO, and conversion campaigns for 50+ businesses of all sizes. He is the co-founder of Social Media Magazine.

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Millennial Investors Will Drive Bitcoin Price Growth in 2019

Even though the vast majority of price predictions for Bitcoin in 2018 were way off the mark, commentators continue to push their forecasts for Bitcoin in 2019. There is the number of cryptocurrency price predictions out there, and many different factors driving them. Should you listen to them? Always take price predictions with a grain of salt. As an investor, you have to make your own decisions. One of the soundest investment decisions you can make is to never invest money you can’t afford to lose, especially in more speculative investments like cryptocurrency. However, the price gains that you could enjoy are enormous. Millennial Investors Will Drive Bitcoin Price Growth in 2019: How Did Past Predictions Turn Out? At the end of 2017, there was virtually no limit on Bitcoin price predictions. Some pundits claimed that Bitcoin prices would reach $100,000 or higher, and some pretty colorful language has been used to express confidence in Bitcoin going as high half-a-million dollars in 5 years. Unfortunately, past bullish sentiments didn’t come to pass. On the other hand, many are now seeing 2018 as the correction that had to happen for prices could bounce back. With the Nasdaq, the second largest stock exchange in the world, vowing to launch a Bitcoin futures exchange, the cryptocurrency is far from dead. Who’s Driving Bitcoin Investment? The short answer: millennials. Millennial investors know that the factors driving economic growth today aren’t the same as when their parents were saving for their retirements. Millennials want to invest differently than the way their parents have. Millennials are more open than their parents to growing wealth through digital currencies, and it’s through them that products like Bitcoin will reach widespread acceptance as an investment vehicle. 2019 Bitcoin Price Predictions: The real question is, what are the experts predicting for 2019? Depending on who you ask, predictions range from prices hovering near $3,500 to more optimistic predictions that prices will near $10,000 by the end of the year. More optimistic price predictions are grounded in upcoming developments such as the Bakkt futures market and growing interest from institutional investors. Mutual funds getting involved in Bitcoin futures will make a major difference for speculative investors hungry for a new commodity to sink their teeth into. But there are going to be two essential indices that you should keep on eye on: 1) Will cryptocurrencies start to move in different directions? To date, cryptocurrencies have generally moved in tandem, with Bitcoin leading wider market movements. 2) How will stock markets move? There’s a convincing argument to be made that Bitcoin already resembles gold in a number of ways, and gold has a historic pattern of rising prices when stock markets. If the S&P drops, will Bitcoin follow suit? Buy Bitcoin Now: If the 2018 Bitcoin price correction has been good for anything, it’s providing a window of opportunity for new investors. If you want to buy Bitcoin, check out Bitbuy or another cryptocurrency exchange offering low fees and fast ways to buy Bitcoin. A reliable cryptocurrency exchange is your gateway into the world of Bitcoin. If you’re ready to grow your wealth with a new type of commodity, buy Bitcoin today. Read Also: Hiring A Blockchain Developer What To Expect When You Become A Forex Trader

How Do You Avoid Negative Equity On Your Next Car Loan?

Car finance allows drivers to spread the cost of a new or used car into affordable monthly payments. By borrowing money from a lender, drivers can purchase a car and pay the lender back in monthly installments until the end of the agreed term. Negative equity is a term you may hear often with car finance, and for many drivers, it is best to avoid it. Find out how you can ensure you don’t end up with negative equity and what to do next if you find yourself in this situation. What Is Negative Equity? In car finance, negative equity is when you owe more on your loan than your car is worth. Negative equity can be known as outstanding car finance or an upside-down loan which means if you sold your car to clear the loan, you still wouldn’t have been able to pay the balance off. For example, if your settlement figure was £6,000 and your car was worth £4,000, you would still owe the finance company £2,000. Usually, negative equity happens when the value of your car drops quickly during your agreement. This is especially common with brand-new cars, as they can lose up to 50% of their value in the first few years of ownership. Here, if you want to trade in your car but have negative equity, you will need to repay the loan amount before you take a new loan to purchase a new vehicle. What Are The Reasons For Negative Equity? Basically, a negative equity situation happens for a variety of reasons. For instance, an upside-down situation in regard to a car loan can happen due to the following reasons: You might have a loan for a longer term. Apart from that, your vehicle has also gone through depreciation since your purchase. There is a no-money-down auto loan in your case, or you might have paid more than the sticker price of the vehicle due to the inclusion of add-ons. You might have purchased an expensive vehicle, which might not have the same value that you expected during the purchase. Your debt regarding the loan is of a high rate of interest. Hence, most of the money that you are paying is going to the interest as compared to the principal. Depreciation is also a major factor in this case. Basically, the term rate of depreciation shows how fast an asset loses its value. Generally, a car loses almost 20% of its value in the first year itself. Furthermore, the process of depreciation continues to happen in the following years until the car fully loses its value. Why Is Negative Equity Problematic? Negative equity within your car finance deal can be an issue because you will still owe the lender money even if you sell your car. In some cases, you may not be able to sell the car, too. If you find your circumstances have changed and you can’t afford to carry on with the loan, you may be charged additional fees for missed or late payments, and it can lead to much more serious financial consequences. How Do You Avoid Negative Equity In The First Place? Before you take out a car finance deal, consider these factors below to help prevent negative equity from occurring: Only Borrow What You Can Afford. If you’re in a position to buy a new car on finance, it’s important you use a car payment calculator first to see how your loan could look and make sure it is affordable. This may mean choosing a used car over a brand-new car, as older cars usually have already depreciated at their fastest rate in previous years. Put Down A Larger Deposit. A larger deposit contribution at the start of your finance agreement can help to reduce your loan amount. A smaller loan can help to reduce the risk of your car being worth less than how much you owe. Choose A Slower Depreciating Car. If you want to avoid negative equity, you could consider choosing a car that depreciates at a slower rate. Cars that hold their value will be less likely to leave you out of pocket at the end of your car finance deal. Make Higher Payments. Negative equity can often be associated with PCP deals as they offer low payments and a large balloon payment at the end of the deal. Opting for a deal such as a hire purchase, which aims to pay off the value of the car at the end of the deal and has higher monthly payments, can help avoid any outstanding finance. How Do You Get Out Of Negative Equity? There are different ways of getting out of negative equity. However, based on your current situation, you will need to choose which way works the best for you. Basically, you will need to choose the one that goes with your budget. Furthermore, it also depends on whether you want to keep the vehicle or not. Hence, to get out of negative equity, make sure you do the following: 1. Start By Paying Off The Loan The most obvious way to pay off your negative equity is to accelerate your payment. Here, the faster you pay your loan off, the sooner you will be able to deal with the debt. One of the best ways of paying off the loan is to pay extra on the principal part. Apart from that, you can also consider paying a lump-sum amount beforehand to avoid paying interest for a longer period. Hence, you must consider reviewing your budget and savings from time to time to pay off your existing debt. 2. Loan Refinancing Here, you might consider taking out a new loan to pay off your existing debt. This will help you in getting out of your upside-down car loan faster. This works even better if you can avail of a new loan with a lower rate of interest. 3. Selling The Vehicle If you do not need the vehicle, you can consider selling off the vehicle. This way, you can get a lump sum of cash, which will allow you to pay off the loan. Furthermore, if you sell the vehicle to a private buyer, you will have the option to negotiate the price further. This will enable you to get more cash, which will further help you to pay off the negative equity. 4. Surrendering The Vehicle If you handle the vehicle to the lender, you can get out of the negative equity, too. In addition to that, if you do a voluntary surrender, you will be more likely to get out of the negative equity. Summing Up: Getting Out Of Negative Equity If you’ve not been able to avoid negative equity and need to know how to get yourself out of it, follow the top tips below: If you can still afford your current car finance payments, it is recommended you stick with the deal you have at the moment. In many cases, your deal will balance out over the duration of the loan, and the negative equity should be settled by the time you reach the final payment. You could pay off your negative equity by paying the lender in cash. You can hand your car back to the lender through Voluntary Termination. If you’ve paid half of your agreement off, you could return the car to the lender. It’s always best to speak with your lender first, though, to see how they could help you. Do you have any more ideas to add? Consider sharing in the comment section below. Read More: Proven Strategies To Captivate Buyers And Sell Your Business Successfully Get On The Online Market With The Best Web Design Experts In Brisbane 8 Tips For Tech Industry CV Writing That Highlights Your Skills And Experience

Private Money Lenders – Here Is Why This Is A Great Alternative For Your New Business

If you need funding - and need it fast - sometimes traditional funding methods do not do the trick. The loan is either too slow, requires too many pre-requisites to qualify for the loan, or you can’t seem to figure out where to ask. We have the best alternative for you that provides fast capital with few strings attached! Benefits of private money lenders for your business If you are interested in really making a name for yourself as a realtor or in the real estate business, you need to make sure you have a constant flow of cash and capital to continue renovating houses, purchasing properties, and dealing with clients. However, if you don't want to go into your own personal debt, you need to use new funding methods that can let you spend the money it takes to flip houses for a profit. But who should you use? Consider using private money lenders to help spur on your business and create long-term potential! Fast approval rates Instead of typical bank loans, where the approval rates and the process can take between weeks - and even sometimes months - using private money lenders is a much quicker process. If you want to buy a property that you are going to flip within the next week, you need money in your hand fast - and private money lenders like Asset Based Lending can do that for you. You have time to improve your property The second reason that you should consider using private money lenders for your business with the flexibility offered with this type of loan. Since a hard money loan is given by private investors, you can change the terms of the loan based on the individual situation and the people involved. This means that if you want to get a long-term financing method to help you with a more extensive house renovation, you can speak with them and negotiate a deal where you earn more funding to make the necessary changes to your property to earn a profit. Credit scores are not valid The third benefit of using private money lenders near me instead of bank loans is that you do not have to worry about your credit score! Whether your credit score has always been poor, or your credit score suddenly dropped due to applying for too many new lines of credit, you may find that your credit score is too low to qualify for the bank loan you need. When it comes to private money lenders, don't worry - they do not take your credit score into account! The only thing the private money lenders care about is the value of the property and the potential for renovation. Bonus: Consider reading our guide on boosting credit scores. Hope it will help out. Conclusion If you're considering using traditional bank loans for your real estate property, choose something else - private money lenders. Not only will this funding method help you get quick approval, get cash in your hand fast, and avoid using pre-requisites like credit scores, but you can immediately begin working on flipping or renovating the house to turn a profit! Read Also: No Credit Rating Check Lendings Online split Second Authorization

Does Inflation Determine The Price Of Bitcoins: What You Need To Know

Does Inflation Determine The Price Of Bitcoins?