Bitcoin Forum

Hello All,

I'm new to the forum and reading a lot. I have (almost) no clue where this forum is about.
The more i read, the more questions i have.

But i think its good to start at the start.

How is a value set for a new coin?
How is the value set for example Ethereum or the Ripple?

thx in advanced!

regards,

Kirtap

I believe the developer is the one who is setting the initial value of the coin on ICO.

For a new coin, in the case of an ICO it would be the developer / manager of the coin which will just set a price on it of which they think is fair.

For coins which are already in circulation, it is a bit more complicated.

Ethereum/xRipple their price is based on their demand. The more people who want Ethereum, the scarcer it will be and thus it will go up.

Demand can decrease/increase due to various things, I'll list some examples down below,

Such as

- FUD, Fear Uncertainty / Doubt / Negative.

- Technical improvements on the coin/project / Positive.

- Partnerships / Positive.

- New faces added to the project, ( good developers) / Positive.

- Project / Coin getting hacked, 51% attacks, vulnbs in code, etc. / Negative.

And thus the price will change. Note that there are ofcourse alot more things which weigh in when calculating the price.

Besides the developers of the project I think the demand for the token during its crowdsale also gives the coin a price and at times after the tokensale depending on which exchange the coin is introduced say etherdelta traders get to determine the price too.

ICOs are tools for crowdfunding created by startups.
The token value is somehow pre-set by the ICO, but after listing on the market, it will be only about supply and demand.

If a coin is not desired, it's holders might undersell and the price will drop.
If the campaigns generates a lot of hype, all those who wants a token but missed the ICO might overpay for those coins, as the demand is higher than supply, and the price will go up.

Here is how many of them work.

Create a new coin and pre-mine 1 million of them.

Sell one coin to your best friend for $2.

Now go online and talk about your ICO. Because the price you established with your friend, you can claim your coin has a 2 million dollar market cap!

Buy back the coin from your friend the next day for $4. Now go back online and brag that your coin is up 100% in 24 hours!

  

Very interesting. Is this how it really works? Based on real experience?
damn, I should start looking for a coin developer  ;D

So i don't need to say someting like:

i have 100 seeds of apples; value 1000 dollar

1 coin is 1 dollar

after u invest, i wil plant the seeds and give them water.

after 1 year i have 230 seeds; value 2300 dollar.

So my coin is 2,3 dollar value right now...


It is in no way connected to a product / company  value?

its just what the ppl want to give for it? And when do u see value in a coin yourself?

I find this very interesting but also very difficult.  I dont have anyone in my surrounding i can ask, so forgive me ;-)

Coin value should revolve around the real world usage and application of the coin before it get on the market! We know that usage does not correspond with price. But value remain and sometimes it could take months before price catch up with value.

Are you trying to find what the initial price of a coin is?
If so then the price of a coin is usually set when enough people make a purchase at a certain price area.

so it should be connected to a product?

like:

a company wants to make a product, value 10 dollar.
u can buy coins before the product is on the market. so u buy it for... say 7,50.

after the product is made u can purchase it for 1 coin.

U can sell the coin for 9 dollar, so u make profit, the 1 that buys the coin had 1 dollar "discount" on the marketprice. its a winn-winn situation.

Later, if the product gets better the value of the coins will go higher. Like there is a version 2.0 of the product on the market, but it cost 12,50. The coin has a value of 12,50 now.

Then everyone would be issuing tokens equal to the value of 1 kg of gold.
What we need to remember is cryptocoins like fiat have no real value but are a mutual guarantee of valuation.

OK,

everybody tanks for your reply!

i appreciate it!