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Why Are There Different Bitcoin Prices in Different Markets?

We look at the three main reasons behind varied prices across exchanges

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By way of an example to start us off, Bitcoin is currently trading on Bitfinex (Hong Kong) at $17,088. Meanwhile, it’s at $17,344 on Gemini (Canada / UK) and $17,525 on GDAX (US). But why is this?

Liquidity

Firstly, if an exchange is well-known, then there will be more trading on it. If there is more trading, then an exchange can bump up the price without the fear of losing its customers. There’s a lot in a name, and in trusting that name with your money.

What is Bitcoin Anyway?

Bitcoin isn’t a fiat currency. It isn’t pegged to a traditional currency either. The whole point is that it is unregulated, operating on a supply and demand basis. If there is a lot of demand, the price goes up. And who is to say what it should cost anyway?

Cross-Exchange Trading Is Difficult

As it is difficult to trade across exchanges, there isn’t much need for the largest companies to start levelling the pricing out. It is expensive, time-consuming and, in some countries, illegal anyway. This means that exchanges can go about their business without all the hassle of arbitrage.

The advice is to stick to one exchange. Choose a well-known one in your country that typically estimates the price well.

Which exchange do you use? What are your experiences with trading? Let us know in the comments.

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