The four most famous international exchanges:

Binance INTL	OKX INTL	Gate.io INTL	Huobi INTL
China Line　APP DL	China Line　APP DL	China Line　APP DL	China Line　APP DL

Note: The above exchange logo is the official website registration link, and the text is the APP download link.

From the daily price changes of Bitcoin, the amplitude exceeds 10% from time to time, and even the price drops by more than half in two weeks. This article hopes to find the reasons for the sharp changes in Bitcoin prices in a short period of time through the changes in Bitcoin prices in the past two years, combined with the news at that time.

1. Overall trend

January 2017 to April 2018

It can be seen that from January 2017, Bitcoin experienced an amazing rise, and then fell sharply at the end of 2017. We will select several time periods with large changes.

2. Recent decline

The last week of March 2018

The price of Bitcoin fell from a high of $8,500 to a low of $6,550, a weekly drop of 23%.

Looking for the news of the week, we found that there were many negative news in the virtual digital currency market that week. For example, on March 27, Reuters reported that Twitter would join Facebook and Google in banning ICO and cryptocurrency advertising on its social media platform. For example, on March 29, my country's central bank held a national video and telephone conference on currency, gold and silver. Fan Yifei, deputy governor of the central bank, said that it is necessary to carry out rectification and cleanup of various virtual currencies, closely communicate and cooperate with relevant departments, and vigorously rectify the chaos in the field of cash circulation.

3. Short-term rise

February 14, 2018-February 28, 2018

In just two weeks, the price of Bitcoin rose from a low of US$8,505 to a high of US$11,065, an increase of 30%.

The reason for this rise is mainly the enthusiasm of investors and investment institutions. On the one hand, the high price of Bitcoin of about US$19,000 last year made investors think that it was time to buy at the bottom. On the other hand, the attitude of regulators in various countries was unclear. In February, the sharp drop in global stock markets made investors more demanding of Bitcoin. Finally, the concept of blockchain became popular, and Bitcoin, as the earliest application of blockchain, was also sought after by the market.

4. Policy pressure

January 8, 2018 - January 12, 2018

The highest intraday price was $16,300, and the lowest price fell to $12,807, a drop of 21.4%.

The news this week mainly came from South Korea. On January 8, the chairman of the Financial Services Commission of South Korea stated at a press conference that they were conducting a joint inspection with the Financial Supervisory Service of South Korea on six banks that provide cryptocurrency account services to verify the implementation of the anti-money laundering regulations previously formulated and the real-name system measures for related accounts. On January 11, according to foreign media reports, the South Korean Ministry of Justice was preparing legislation to pave the way for the complete closure of domestic exchanges.

5. Crazy 2017

From the end of September 2017 to the end of the year

The price of Bitcoin soared to $19,000 at this stage, and then fell to about $13,000, with the maximum increase of 3,750%, and the subsequent decline in the next half month also reached 32%.

Overall, first of all, in 2017, the public's awareness of Bitcoin has been comprehensively improved, and many institutional investors and retail investors have entered the digital currency market, especially the Chinese market. In January 2017, China's trading volume far exceeded that of other countries, accounting for about 80% of the world. Although on October 31, digital currency trading completely withdrew from the Chinese market, the Chicago Mercantile Exchange announced the launch of Bitcoin futures on the same day. On December 11, Bitcoin futures were officially launched, and then they were popular among investors, triggering three circuit breakers.

In the birthplace of Bitcoin, with the rise of Trump and unclear policy orientation, digital currency has become a safe haven option for American investors. Japan officially recognized the legal status of Bitcoin in April this year, and Japanese investors also rushed into the Bitcoin trading market crazily.

6. Summary

From the above examples, we can see that there are many factors that can affect the price of Bitcoin, which can be summarized as follows:

1. Investment supply and demand factors
This factor is actually not independent. Investors' demand for Bitcoin is actually affected by multiple news factors. However, judging from the sharp rise in prices in 2017, in the absence of obvious policy news, the entry of investors and investment institutions will also drive price growth.

2. Policy factors, which are also important factors affecting Bitcoin prices. In the above examples, the implementation and formulation of policies in South Korea, Japan, the United States, and China have all affected the trend of Bitcoin prices.

3. Real financial factors
The instability of the real financial world has caused the demand for digital currencies to rise from time to time. For example, the default of the Central Bank of Cyprus, Brexit, and the setback of global stock markets in early 2018 have all brought Bitcoin's risk-averse characteristics into play.

4. Technical factors
Although the security of Bitcoin has been highly praised in its development, there have been several technical crises in its development history. For example, Bitfinex, the largest Bitcoin-US dollar exchange, was hacked and 120,000 Bitcoins were stolen. Bitcoin fell by 25% in the following six trading days.

In summary
The author believes that Bitcoin, as a digital currency that can be traded globally, is also affected by many factors, resulting in a large range of price fluctuations. For investors, a stronger risk tolerance is required. Before investing, investors should not blindly follow the trend to prevent large losses.