How can coin prices be determined?

[Grandeur247]

The crypto world is such an unpredictable world. Most times I sit down to imagine how the markets are decided. At one point, you will see a particular coin price going up, and at some point, the price will fall drastically. I have been wondering for several days as what could have been the reason for the unusual changes but I'm yet to find out. If anyone knows, please kindly relate as I'm new in the crypto world.

[1714124841]

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[1714124841]

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[1714124841]

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[treespace]

Crypto's a new frontier, but supply and demand determine price- same as with anything else.

Of course, demand for crypto's super volatile and often irrational.

Price and market cap don't tell the whole story.  Looking at depth charts (how much supply and demand exist across different prices) on exchanges is pretty illuminating.  For instance, a low key altcoin with a market cap (price/coin X number of coins) of $1,000,000 might see its value drop 25% after one big holder tries dumping just $10,000 because not many people want to buy.

As for what causes these swings... algo trading, pump and dump manipulation, consolidated ownership among a couple of whales, mass hysteria... barring some major news story it's usually hard to say.

[D3F4L7 RAT]

Cryptocurrency price are determined by the Law of Supply and demand, and sometimes it is driven by news. The continous fluctuation of bitcoin as well as other cryptocurrencies is caused by massive selling rather than buying.

[Beatridge]

Cryptocurrency price are determined by the Law of Supply and demand, and sometimes it is driven by news. The continous fluctuation of bitcoin as well as other cryptocurrencies is caused by massive selling rather than buying.

In my experience, news play here major role. News ->panic selling/buying->a strong change in the exchange rate

[Tom R]

While the price itself is a function of supply and demand I think the harder and more interesting question is what is the fundamental value. For example with Bitcoin, some people look at the total addressable market (TAM), take a % of that and divide by the total supply of Bitcoin (either in circulation of max supply) to derive a price per coin. If one were to think that Bitcoin could eventually become digital gold then one would take the market cap of gold (roughly $7.5 trillion) divided by supply of Bitcoin (around 16m in circulation and will never be more than 21 million ever) to get to a rough range of 300-400k per Bitcoin.

This in no way implies that Bitcoin will ever trade that high or couldn't go higher. Sentiment matters too.

[taeewo]

The crypto world is such an unpredictable world. Most times I sit down to imagine how the markets are decided. At one point, you will see a particular coin price going up, and at some point, the price will fall drastically. I have been wondering for several days as what could have been the reason for the unusual changes but I'm yet to find out. If anyone knows, please kindly relate as I'm new in the crypto world.

The real cause is just determined by demand and supply, you will also observed that in real life business when there is high demand, the price of goods tend to shoot up but when there is supply i e when people are selling, there is a tendency of the price falling...

[Ranillo79]

To predict a coin will pump is do a research about the coin and analize it to knew that this coin is a legit one. If this a legit it surely pump now worries that it stock at a low price.

[Grandeur247]

Crypto's a new frontier, but supply and demand determine price- same as with anything else.

Of course, demand for crypto's super volatile and often irrational.

Price and market cap don't tell the whole story.  Looking at depth charts (how much supply and demand exist across different prices) on exchanges is pretty illuminating.  For instance, a low key altcoin with a market cap (price/coin X number of coins) of $1,000,000 might see its value drop 25% after one big holder tries dumping just $10,000 because not many people want to buy.

As for what causes these swings... algo trading, pump and dump manipulation, consolidated ownership among a couple of whales, mass hysteria... barring some major news story it's usually hard to say.

Thank you for your explanation. I'm getting this gradually

[dougytvkki]

Apart from above points, I think influencers play a big role in increasing or decreasing the price of coins. If an influencer posts something good about a coin, the value of that coin increases, although it generally decrease after some time.

[Grandeur247]

The crypto world is such an unpredictable world. Most times I sit down to imagine how the markets are decided. At one point, you will see a particular coin price going up, and at some point, the price will fall drastically. I have been wondering for several days as what could have been the reason for the unusual changes but I'm yet to find out. If anyone knows, please kindly relate as I'm new in the crypto world.

I really appreciate all the comments here. So far, I have outline the reasons behind the fluctuations in coin prices.
1. Demand and supply
2. News
3. Influence
 Thanks for helping me out. I intend conducting further research on this

[rickdeed1956]

The crypto world is such an unpredictable world. Most times I sit down to imagine how the markets are decided. At one point, you will see a particular coin price going up, and at some point, the price will fall drastically. I have been wondering for several days as what could have been the reason for the unusual changes but I'm yet to find out. If anyone knows, please kindly relate as I'm new in the crypto world.

I really appreciate all the comments here. So far, I have outline the reasons behind the fluctuations in coin prices.
1. Demand and supply
2. News
3. Influence
 Thanks for helping me out. I intend conducting further research on this

Add in hype and development teams.  Some teams have influential members who name recognition alone drives the price of a coin (EOS).  Having people that have already proven themselves in another coin is a big factor when determining scale and cost of ICO tokens

[geniusminds]

1. Market cap
2. Volume of trading, demands
3. Governmental Regulatory Issues
4. Related News whether favorable or negative
5. Rumors/Hearsays/Future expectations