Figuring out the "actual" price of a token

[Len Saldua]

Hey people.
Just noticed how different pages list different prices for any particular token.
For example, Quant 5 minutes ago was listed at:

$156.44               at Coin Gecko
$160                    at My local centralized exchange
$163.44               at Coin Market cap

What gives ? These are huge differences if you've got large number of tokens !?

NOTE: I am using the Australian Dollar for currency in this example ( something I can not figure out how to display on Coin Market Cap ! )


Also: My local centralized exchange has a different "sell" and "buy" price for a token. For instance, if a token is listed at $160 per token, the buy price usually would be $162 and the sell price would be $158. So that adds to the confusion, although my exchange tells me the listed price ( in this case $160 ) is the "average" price of any given token.

[BlackBoss_]

Depends on where those sites get their price sources. They usually have different formula to get price. Usually it is an average price from a basket of some big exchanges.

If their formulas are different, their price will be different.

When you trade derivatives, margins, exchanges use different formulas for liquidation.

[Solosanz]

Different exchange will have different people who want to trade, different people who willing to buy and sell the token, different exchange who set up the normal price, etc etc.

There's no actual price of a token, the price are completely similar with the one exchange and the other exchange just like you mentioned above. The difference is only around few doillars, just think it as a fee. Even you're doing arbitrage trading, I doubt you can make profit when the price of the token is only $7 difference. The trading fee and withdrawal fee of each exchange is high.

[_act_]

Prices on the sites that list coins and tokens can not be the same because they do not list all the same exchanges to take the average of price. On exchanges, there are also different price because they have different order books, buyers and sellers, the price is controlled by the total buying and selling on an exchange.

Also: My local centralized exchange has a different "sell" and "buy" price for a token. For instance, if a token is listed at $160 per token, the buy price usually would be $162 and the sell price would be $158. So that adds to the confusion, although my exchange tells me the listed price ( in this case $160 ) is the "average" price of any given token.

I have seen exchanges like that before, but not common, I prefer exchanges that do not have this. I think this is used in a way to charge the fee.

[Maus0728]

There is no "real" or "actual" token price. So if you ask which one is correct, the answer would be all of them.

The reason why coinmarketcap or coingecko have different prices is that both platforms have different sources for their data, and perhaps, their calculator also has a different methodology for calculating the prices between exchanges.

If you are trading, what matters the most is the token price on the exchange you will use unless otherwise you are doing some arbitrage trading wherein you need to take advantage of price discrepancies between two or more trading platforms.

[ABCbits]

For example, Quant 5 minutes ago was listed at:

$156.44               at Coin Gecko
$160                    at My local centralized exchange
$163.44               at Coin Market cap

What gives ? These are huge differences if you've got large number of tokens !?

Both CoinGecko[1] and CoinMarketCap[2] have different data source and use different way to calculate average price of a token or cryptocurrency. Besides, when you have big number of token, you'll have consider trading fee, ask volume and withdraw fee to maximize your profit.

[1] https://www.coingecko.com/en/methodology
[2] https://support.coinmarketcap.com/hc/en-us/articles/360015968632-How-are-prices-calculated-on-CoinMarketCap-

[cryptoaddictchie]

Maybe because they have different reference of dataset of trades or exchanges. Not both have the same information and sometimes these data shifted very quickly and their platform will process it based on the average prices of their listed exchange.

Its also a good way to use arbitrage if the fees on those platform arent big and can do some profits when trying to buy and sell.

[Eternad]

Hey people.
Just noticed how different pages list different prices for any particular token.
For example, Quant 5 minutes ago was listed at:

$156.44               at Coin Gecko
$160                    at My local centralized exchange
$163.44               at Coin Market cap

What gives ? These are huge differences if you've got large number of tokens !?

NOTE: I am using the Australian Dollar for currency in this example ( something I can not figure out how to display on Coin Market Cap ! )

This is because of the difference on orderbook liquidity volume. The price difference on exchange varies most of the time because they have different liquidity volume which is important for the price impact whenever the trader on that particular exchange make a huge purchase or sell.

I suggest that you should use exchange with huge volume and liquidity on orderbook so that it will have small price spread when you trade.

[NeuroticFish]

NOTE: I am using the Australian Dollar for currency in this example ( something I can not figure out how to display on Coin Market Cap ! )

If you try to use CAD and other non-USD, non-EUR currencies, you will most probably face not only the problems of the token's price, also problems with different quotations for USD-CAD (or other currency).

CMC and CoinGecko get info from various exchanges and various pairs. They may or may not care of your exchange. They may even care about the reported volumes to make certain exchanges' price be more meaningful (weighted average).
Of course, the average between sell and buy price is the basis in all cases.
Then, as I said, depending on what they use for converting to CAD, the differences can get even bigger.

What gives ? These are huge differences if you've got large number of tokens !?

Nothing spectacular. It simply means that with some luck and by looking up the right moment and the right exchange, you may buy cheaper or sell more expensive than you do at your local exchange.
This is what arbitrage is made for - some traders try to even earn money from such differences. But you're at the middle, and if the spread is not too big at your exchange then you're fine.

However, I'd warn that arbitrage is risky - from getting onto unknown exchanges with issues at deposits or withdrawals to slow blocks making the difference disappear by the time your money arrive to the right exchange - so be careful if you go on that path.

[hugeblack]

Do not be scammed by the price only, but trading volumes may play an important role. You may find that the price of the token in a platform is cheap/good, but there is not enough liquidity, which ends with your purchase or sale order without execution and for a very long period.
Also, the "real" price is the price of executing the buy/sell order, and other than that, they are averages that tell you the fair price, and you determine the appropriate price for you.

[STAI_BLOCKCHAIN]

Depends on where those sites get their price sources. They usually have different formula to get price. Usually it is an average price from a basket of some big exchanges.

If their formulas are different, their price will be different.

When you trade derivatives, margins, exchanges use different formulas for liquidation.

Yes exactly and sometimes the price is not 100% live and can be delayed. Depending on the exchanges on which the coin is traded.

[Doan9269]

Expect variation in token price since you're getting bthem from a different platforms, same way applies to when you're buying them or selling, the reference price varies as well, it's now left for you to decide on the one that best suits your choice, this is something common to cryptocurrency at large, but we have some site where you can get the actual price like coinmarketcap, coingecko and so on, but it changes nothing about them than the price little variations.

[rat03gopoh]

Refreshment time can also affect it, each aggregator must have a different time when the latest prices are taken. Especially when the market is highly volatile it will produce a very significant difference as the OP pointed out. So, you can prove both aggregators on one listed exchange with the same trading pair.

[pooya87]

Different price in different sources (including exchanges not just price reporting websites) depends on a lot of factors in addition to what others said.
For example sometimes the coin you are looking at is dead (has no blockchain) so nobody can transfer that coin between exchanges and the price difference can not be used as Arbitrage so it remains different. Sometimes one exchange's wallet is dead (maintenance, etc.) that prevents deposits of that shitcoin and nobody has it to dump so the price could go higher or remain higher while it dumps elsewhere hence creating a difference.