Over the years, the value of the bitcoin has been growing in value and the benefits are adverse. It has been able to provide more opportunities as opposed to when they were first created. Though it was a concern over its value as a currency, it is gaining popularity and acceptance. Currently, it is better placed and is considered an asset and an innovative way of controlling inflation.

Though the bitcoin is gaining popularity, it is still facing some challenges in the financial markets. The price fluctuations of the bitcoin are determined by a number of factors. It is important to note that volatility in Bitcoins has not yet provided a universally accepted index. However, the following contribute to the reason why the bitcoin value is fluctuating in the year 2015.

It’s perceived value against the fiat currency

The bitcoin value is noted to fluctuate probably due to its perceived store of value against the fiat currency. Keep in mind that bitcoins were produced in limitation and are therefore, rare as opposed to the fiat currency. In this, many are willing to invest in this currency, which is governed by the government as opposed to the bitcoin. It becomes a challenge when you cannot identify the strength or weakness of a currency. This has led to the fluctuating value of the bitcoin because one cannot be so sure of their investment.

l Bad press by governments

Though the use of the bitcoin is becoming popular, it is also scaring away many potential investors in the market. This is because some governments have made it clear that bitcoins may not be used in some transactions as a currency. In this, the governments are regulating the use of bitcoins in the market. This has led to the scare of many Bitcoin users from making the best of their investments with the consideration of the bitcoin. While many want to make their investments, their investments are short-lived thus its fluctuation in its value.

A variance in the perception of bitcoin store and method of value

Different individuals have a different perception on the influence of the cyptocurrency as a means of value transfer or as it being valuable in the long run. In this, it becomes difficult to know or predict the value of the bitcoin in the future. It also becomes difficult for one to exchange these bitcoins for a given asset and one cannot be sure that the value as when the asset is acquired still holds any value. In this, with the unclear store of value which refers to the function in which you can use an asset in the future while making, a predictable value makes it a worry for many investors.

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It offers very little options on its value for holders with large currencies.

The use of bitcoins in the market comes with challenges as well as limitations on the number of options you can work with as a bitcoin investor. In the event that a bitcoin investor accumulates a large value of bitcoins, it becomes difficult to liquate such amounts. This is because not many individuals are trading in with bitcoins. The volume becomes a difficult aspect to deal with as not many have adopted the use of the bitcoin currency.

The concern of security breaches

Bitcoins are exchanged virtually and it has raised a concern in reference to security breaches with the presence of hackers. When a security breach is announced, it creates fear amongst investors and more people opt out. In this, it leads to the fluctuation of the bitcoin value as it is not secure at all times and its future is questionable. Just as with every financial decision, security breaches are not a sign to embrace.

The fluctuating value of the bitcoin in 2015 is as a result of the above and it can be result to lasting influences in the market. Though they were initially independent of any governments, it is becoming clear that the governments want a piece of it and are trying to find a way of regulating its use. This may limit its use from one country to another. However, the above factors may be controlled and the future of the bitcoin market will be safe as well as provide an effective store of value for its users.

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