Based on Google Trend reports, one of the highly searched topics about Bitcoin is its market price. The price of BTC is a key part of the crypto coin because Bitcoin has the qualities of money based on math principles.
Bitcoin gains value that can be measured by its growing base of users, merchants, and startups. This is because trading determines the price of BTC. However, there are a lot of things going on underneath the surface.
To further understand the intricacies of the crypto asset and have an informed judgment in BTC trading, it is important to understand Bitcoin price metrics. Learn all there is to know on how to understand Bitcoin price metric here at BTC Post!
What is a Bitcoin price metric?
A Bitcoin price metric is a unit of measurement to which the price is applied. In the most basic sense, it defines the terms of exchange such as what a buyer will receive per unit of the price paid. This means that it is the price settled on when bidders and sellers talk with each other and reach a deal to trade BTC.
Key Bitcoin price metrics you should know
The value of Bitcoin is mostly determined by the market forces of supply and demand. However, there is more to it if we go down a level deeper. Check out the Bitcoin price metrics you need to know below:
It is the current price of Bitcoin sold in the leading crypto exchange sites. The surge of buying pressure is what makes BTC’s price go up. On the other hand, the boost in selling pressure drops its market value.
Realized cap and price
This Bitcoin price metric measures the relative size of the crypto coin. To do so, the market capitalization of Bitcoin is determined by multiplying the total number of BTC circulating in the market by its latest market price. At the time of writing, the market cap of Bitcoin sits at US$199.62 billion.
Moreover, the realized market cap also takes into account the lost or unclaimed coins by calculating only the actual coins in the Bitcoin ecosystem. To effectively discount inert or lost BTC, the realized cap sums up the value of BTC the last time it moved. This allows investors to gauge the average price for all circulating coins.
First introduced by Renato Shirakashi, it is the moving average of Bitcoin’s volatile market cap. To get the average cap of Bitcoin, a total moving average is applied to the prices of Bitcoin right from the genesis block. It is a valuable metric for finding the true average of Bitcoin’s market cap history.
It is the speed at which a computer completes an action in the Bitcoin network. This means that the higher the hash rate, the better it is to mine due to more chances of finding the next block and getting the reward.
It is where the miners can pick a transaction before beginning the process of confirmation in the blockchain. It also refers to the current size of the pool in bytes. This means that if the size is big then there are multiple transactions waiting to be confirmed in the blockchain.
Median confirmation time
When the miners have picked up their transactions, they will then proceed to the public ledger so it can be visible to all users. The Median confirmation time chart can give you details such as the amount of time it took for it to be accepted in the blockchain.
Moreover, the chart shows the average minute it took in real-time. It also includes transactions with miner fees. Therefore, the higher the miner fees you pay, the faster your transaction will be mined in the mempool.
Understanding Bitcoin price metric
A blockchain explorer is a useful website where you can check all the information of a blockchain in real-time. When you go to a blockchain explorer site, one of the things you will see is a table with four entries.
They record the latest blocks that were mined on the Bitcoin blockchain. Find out more about them so you can understand Bitcoin price metrics better.
Height of the block
It is usually the first column in the table that refers to the block count. At the time of writing, Bitcoin is on its 659,431st block. Moreover, the first block ever created on the Bitcoin blockchain is called the genesis block that has the height of 0.
Age of the block
It refers to the time passed since the block was mined up until the time you are viewing it. Since each Bitcoin transaction needs to be confirmed, there are around 10 minutes between each block. As of October 2020, the average confirmation time for a Bitcoin transaction is 12.74 minutes.
It refers to the number of transactions that are recorded in a single block. Its number can vary based on the size of each transaction. There is a general rule that a block should be around 1 MB big.
It refers to the total number of BTC that are included in all of the transactions inside a single block.
Why use Bitcoin price metric
As of now, there are 18,556,881.25 BTC in existence with new coins being mined every 10 minutes. Due to this, it can be overwhelming to keep track of your Bitcoin transactions. That is why it is important to understand the Bitcoin price metric.
With the rise of cryptocurrencies, crypto developers have created the Bitcoin price metric so it will be easier for users to track and maintain their digital assets in their wallets. You can simply review the price history, market capitalization, price tracker, and even live charts for Bitcoin for a more informed decision in trading.
Find out more crypto updates and guides here at BTC Post so you can become a smart crypto trader in the market!
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