Bitcoin (BTC) price fluctuations are affected by several key factors, including:
🔹 **Supply and Demand**: Since the maximum total supply of BTC is **21 million units**, an increase in demand against the limited supply leads to a rise in price, while a decrease in demand leads to a decline.
🔹 **News and Technical Developments**: Any announcement about technical updates or new partnerships can boost investor confidence and raise the price, while negative news such as **regulatory restrictions** may lead to a decline.
🔹 **Government Regulations**: Government decisions regarding digital currencies, such as **banning mining** or imposing taxes on trading, directly affect the price of BTC, as happened when China announced a ban on cryptocurrency mining.
🔹 **General Investor Sentiment**: When there is optimism in the market, demand for BTC increases, while economic concerns or financial crises lead to price declines.
🔹 **Institutional Adoption**: The entry of major companies like **Tesla and PayPal** into the BTC market has significantly increased its value, as institutional adoption enhances trust in the currency and increases demand for it.
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