Bitcoin is a special form of virtual currency, which is based on mathematical algorithms and is naturally independent of countries or institutions. It has investment characteristics similar to precious metals and the convenience of paper money payment. It is an open source distributed electronic cash. Development and design of bitcoin based on P2P network. Anyone who is willing to participate in the data calculation of the whole network can obtain bitcoin by virtue of their own computing power. It is naturally independent of any country, any government, any central bank and any enterprise. The neutrality of Bitcoin also restricts any country or institution from issuing too much money, making it the most likely currency in human history to avoid continuous depreciation. Another possible driver of bitcoin price is its popularity. In short, people's interest in Bitcoin is related to the actual simple investment in Bitcoin, which leads to the increasing demand for Bitcoin, thus raising the price. In order to quantify the role of interest in promoting bitcoin prices.
Traditional currency has intrinsic value because of the independent support of the issuer, while bitcoin has no independent value because there is no such support. According to the efficient market hypothesis, this is still the main hypothesis in financial market analysis, and bitcoin cannot preserve its value. The efficient market hypothesis holds that the market value of an asset is equal to the sum of the value streams generated by its best estimated income. Bitcoin does not generate any income and has no intrinsic value. It must be appreciated to ensure that people are willing to capture them. However, there are only endless expectations and no cash flow, which is consistent with the definition of bubble in the efficient market hypothesis. Trading users are limited in professionalism and biased towards positive news, resulting in a lack of objectivity, which may make Bitcoin users bear greater risks than traditional investors.
Most bitcoin users use it as a speculative investment rather than a tool to buy goods. The fact that this conclusion is drawn is that the increase of public attention has led to the increasing demand for bitcoin, while the actual number of bitcoins used to buy goods has remained basically unchanged. The transaction chart shows that 80% of Bitcoin users buy it as a speculative tool. The low liquidity of Bitcoin means that a transaction may affect the value of Bitcoin, so the risk of this transaction to investors is obvious.