Why in different countries prices for bitcoin may differ
Depending on the country and crypto-exchange rates, the cost per crypto asset may vary. We have considered several factors that influence the formation of prices on crypto market, and how they are related to the geographical location of the suppliers of cryptocurrency.
First of all, it is worth considering the fact that there is still no generally accepted scenario for using cryptocurrency. For some, the reason for investment is the belief that thanks to the cryptocurrency, blockchain technology awaits a period of rapid growth. For others, it is the belief that those Bitcoins that they bought today in the future will be in great demand in everyday life. For the rest, and most likely most, the reason for buying bitcoin is the desire to make a profit.
Also, we all know that bitcoin does not have a stable price, it is the decentralized cryptocurrency of the global digital economy that is not backed by any asset, is not provided with any fiat currency, and does not belong to any state of the world. However, as with most consumer goods, the bitcoin price is formed on the basis of supply and demand for it. In other words, the price of the world’s first cryptocurrency is a certain balance between the price offered by the sellers and what the buyers are willing to pay.
There are countries where trading with cryptocurrencies is prohibited, and bitcoin can only be bought directly from vendors-suppliers, and not at crypto-exchange exchanges. For example, after the interdiction of exchanges in China, the volume of transactions on the p2p plattform of LocalBitcoins has dramatically increased. In many countries, in order to buy bitcoin, you need to have a bank account and an identity card. For example, South Korea’s financial regulator has officially banned anonymous transactions, now traders are required to re-register virtual accounts into accounts with real names.
Due to regulatory restrictions, sellers of bitcoin on such p2p plattforms as LocalBitcoins can set an inflated price and be sure that buyers will pay it. “Suppliers” of bitcoin are often represented in the form of companies that reserve a large number of bitcoins and fiat money, and they can dictate their terms to small buyers, especially if the region is in great demand for cryptocurrencies. For example, in South Korea bitcoin is on average $ 400 more expensive than in the US, and the difference for sale and purchase can be from $ 1800 to $ 3000. In India, the bitcoin seller offers currency at a price 20% higher than what is installed in the US market. The difference in the price for the sale and purchase of bitcoin in India is about $ 1000. In China, the bitcoin rate is $ 100 higher than in the US, and the currency is sold and bought with a difference of around $ 500. At the same time, in Russia the bitcoin rate is $ 100 lower and approximately equal to the rate of cryptocurrency in the EU countries, and the difference between the bid and sale offer can be about $ 400. Despite such differences in price, sellers always have buyers who have no other choice if they want to get into the World of Crypto.
The crypto market is still very young and no one can foresee what the final destination of bitcoin is or what the future of this industry will look like. In this market now there is a large number of players who pursue a single goal – to make a profit. And this means that in one day such players will leave the market, taking with them the earned money. But with this scenario, there is one key advantage – when this happens, rational demand will reduce all cryptocurrencies prices to the same level in all countries and all markets. Until this happened, just try to enjoy what is happening, maneuvering in the current chaos.
Bitcoin Prices may vary
Author: Richard Abermann