What Is The Reason For Bitcoin’s Similar Pricing Across The Different Crypto Exchanges?
Bitcoin is the digital currency that surfaced in the year 2009. Propelled by Blockchain, the exchange of this currency works on peer-to-peer interaction. Besides, there is no third-party intervention making the Bitcoin exchange a popular digital currency. Over the years, Bitcoin has garnered a lot of attention from the technology domain, and we are witnessing a rise in the demand for Bitcoin. Investors are actively investing in Bitcoin, and one can easily exchange Bitcoin over the different platforms. But one question that keeps on popping is how Bitcoin price remains almost the same across the different crypto exchanges? Well, we are trying to unveil the answer to this in this blog.
The Various Crypto Platform For Bitcoin Exchange:
As we have mentioned above, there are various exchange platforms where one can do the crypto exchange. Some of the popular choices are:
1. Coinbase
2. Binance
3. Cex.io
4. Coinmama
5. BitFlyer
6. Coinsmart
7. Bitstamp and many more
If you are keen on Bitcoin exchange or any other cryptocurrency exchange, you must consider either of these platforms. Now let’s shift our focus to the similar pricing of Bitcoin on a different crypto exchange.
The Reason:
Arbitrage plays a key role in this. Before heading further, let’s understand what does arbitrage means. In the economic context, it is the practice to take the benefit of the price difference between the two markets. The profit is the difference between the market prices at which the unit is being traded. In this case, we are talking about Bitcoin.
Now, let’s understand how transactional Bitcoin is the price, also known as spot BTC, determined in the crypto market. The price of Bitcoin is usually the price at which people are ready to buy or sell Bitcoin, and it is because of this reason that there is not much difference in the price across the different crypto exchanges.
Let’s explain this with an example, if one crypto exchange has $50,000 per coin and another crypto exchange has Bitcoin at $60,000, it is obvious that the investor will invest in the BTC, which is at $50,000, and sell it on a platform which has a higher price, and keep the profit with them. Various other factors contribute to the arbitrate like the timing of the transaction, exchange restriction and bots.
This was the basic reason responsible for the similar price of Bitcoin across different platforms. To become well-acquainted with Bitcoin exchange and Bitcoin trading, one must know about the various cryptocurrency platforms and tips and tricks of trading. A Bitcoin certification course and cryptocurrency exchange will be helpful in this. Also, many startups are venturing into this segment, and if you too are willing to be a part of it, this is the right time to begin.
Begin Your Learning Journey Today:
The Blockchain Council is offering the best learning platform in Blockchain and Bitcoin. If you, too, are willing to learn more about Blockchain or cryptocurrencies, then this is the right time to begin your learning journey. Connect with the Blockchain Council today.
