Why does Bitcoin behave this way?

The price of Bitcoin is often volatile. It can sometimes rise and fall suddenly. There are several main reasons for this volatile behavior.

First, demand and supply. The total number of Bitcoins is limited, a maximum of 21 million coins will be created. So when people buy more in the market, the price rises quickly. When there is more selling, the price suddenly falls.

Second, market sentiment. When there is good news, such as a major company accepting Bitcoin, or a country declaring it legal, investors gain confidence, resulting in a price increase. On the other hand, negative news, such as hacking, sanctions, or economic uncertainty, everyone panics and starts selling.

Third, the influence of whales or large investors. Some investors hold large amounts of Bitcoin. When they suddenly buy or sell in large amounts, there are large price fluctuations in the entire market.

Fourth, the global economy. When the dollar strengthens, many investors sell Bitcoin and move to safer assets. On the other hand, when inflation or economic crises occur, many see Bitcoin as an alternative security, which increases the price.

Finally, Bitcoin is still a relatively new technology. Therefore, its market is not yet fully stable. As acceptance increases over time, its price may stabilize.

In short, the reasons for Bitcoin's volatility are limited supply, investor sentiment, the influence of big players, and fluctuations in the global economy. Therefore, it is important to understand the risks well before investing.