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> why do prices rise when supply increase?
The supply of Bitcoin did not increase.
- The supply of "USDT" increased. Note that "USDT" is not USD, and it is also not Bitcoin.
- The price of Bitcoin increased.
Possible explanation: Tether created more USDT and sold them to people who paid with fiat money. Those people then used those new USDT to buy Bitcoin (and/or other cryprocurrencies), so there was increased demand for Bitcoin.
I hope @tante will correct me if I'm wrong.
@gabrielesvelto @eliasr @Josteglitz @tante great explanation, thanks!
@gabrielesvelto @eliasr @Josteglitz exactly this. Bitcoin is bought with Tether which is just fake USD increasing the price to use when dumping assets on retail
@eliasr @Josteglitz @tante people aren't buying Tether with fiat money, certainly not on the scale of the amount that were printed. The way they push prices up is by wash trading. The company that owns Tether also owns the Bitfenix exchange, so they can make fake trades where Bitcoins are exchanged with Tethers at inflated prices. The trade prices are reported as if the they happened in US dollars. Those who fall for it will typically buy Bitcoins with fiat money at the inflated price.