The cryptocurrency market is especially attractive for those traders who used to trade on stock markets because digital assets are unpredictable and so allow them to earn more in shorter terms. On the other hand, high volatility and lack of control bear higher risks, so many people are still beware of getting into crypto trading. To succeed, you should not treat trading as a casino game of lottery – instead, you should understand how prices are formed, what affects them, and which strategy to apply in this or that market conditions.
So what forms a cryptocurrency market price? Demand and supply balance is the main driving force for crypto rates. This field is not regulated by governments, and the emission of digital assets is not subject to central banks. That means no one can cut crypto supply or increase it by “printing” additional funds like they do with traditional currencies.
Crypto supply depends on the number of coins issued and put into circulation. This number is encrypted in algorithms when a project is being developed. It is possible to cut the supply artificially by implementing the “burning” mechanism.
Demand for crypto assets depends on:
- Technology of the project. If there is valuable technology and real application for assets, they are in demand.
- Community and social networks. If the project has a large community of users and crypto holders, it helps to keep its price high.
- The market trend. Bear and bull markets are characterized by massive increases or drops in crypto rates throughout all exchanges. Those tendencies replace one another.
- News background. Demand drops if the media coverage is not favorable to the crypto market.
Where to Find Cryptocurrency Market Price?
The most relevant crypto rates can be found on large crypto exchange platforms where crypto transactions occur. The current price depends on the value of previous transactions made on every specific crypto exchange, so crypto rates may be a little bit different on different platforms. We recommend using large and reputable services such as WhiteBIT – the most prominent European crypto exchange with a high level of safety for clients and their funds.