Bitcoin value goes through significant fluctuations over large periods of time.
If you look at a chart over one year, you will notice that there were grand jumps up and down the scale.
For example, the bitcoin exchange rate for US dollars according to CoinDesk on July 1st 2013 was $84.61 for a bitcoin.
On December 4th of the same year, the value of bitcoins was $1,147.25 or approximately 14 times more. Move on to present day and the current bitcoin value is $592.60.
The fluctuations are apparent and are caused by many different phenomena. Even now that the price seems to have stabilized a bit, daily movements can have $30-40 (or more) differences between highs and lows.
This gives a unique opportunity for the people who adept in trading to score a hefty profit, but this is not without a risk.
For the past week the movements have been somewhat steady, with only about a $40 difference between the highest and the lowest point.
However, look at the monthly graph and you can see differences of more than $100. If you’re good at following these differences and capitalize on the current market value, then you can make some really nice money out of this.
Especially for miners, it’s essential that they sell when the price is high.
The profit and the return on their investment (hardware, power, etc.) depends entirely on when they decide to sell.
They always need to ask themselves, “What is the price of bitcoin?”
Depending on the answer, they should either sell or keep their bitcoins until they find more favorable conditions. Sadly, nothing is certain in this game.
Sometimes the price may seem low to you, but it can then additionally plummet, leaving you in an even more unfavorable position.
That’s why it’s important to follow the bitcoin live price and draw your conclusions from there. Can you afford to wait several months (potentially) for the price to go up?
Or do you need to cut your losses while you’re ahead. These are very important questions you need to find the answers to. Bitcoin mining is actually a very small part of the potential profit you can make.
The bitcoin exchange rate is a lot more important. It’s one thing to sell 50 coins while the price of bitcoins is $600, but another thing altogether to sell at $200.
Keep it smart and try to stay ahead even though it’s insanely difficult.