After bouncing from the $30,000 range, Bitcoin BTC/USD has been trading near the $40,000 level over the last week.
Bart Smith, head of the digital asset group at Susquehanna International, explained the Bitcoin price fluctuation Friday on CNBC's "Squawk Box."
At current levels, "the world has to absorb $36 million Bitcoin mined per day," he said, adding there are about 900 Bitcoins mined each day.
When people want to buy more than $36 million of Bitcoin per day, the prices go up. If people buy less than $36 million Bitcoin per day, the prices go down, Smith told CNBC.
The asset class is being driven by headlines right now, he added.
The smart people in crypto are paying attention to the "massive investments" being made in various cryptocurrency exchanges and platforms, Smith said. There are big-name companies making these investments in crypto, he noted.
"Across the board, you look at those numbers and you say, 'man there must be something going on, maybe I should get back in,'" Smith said.
For those who have alternative payment methods and live in a relatively stable place such as the U.S., Bitcoin doesn't seem to be a necessity, he said. In much of the rest of the world, Bitcoin "makes a tremendous amount of sense," he emphasized.
"There are a lot of things that are complicated about Bitcoin. The inflation rate is not one of them," Smith told CNBC.
At the current mining rate, all available Bitcoins are expected to be mined sometime in 2140.
BTC Price Action: Bitcoin is up 33.95% year-to-date. At last check Friday, it was down 2.31% at $39,109.90.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Visit Benzinga's Crypto Homepage - 1,000,000+ depend on Benzinga Crypto every month