Skip to main content

Posts

Showing posts with the label price

How is the price of cryptocurrency determined?

Cryptocurrencies are digital, so theoretically the creators can make the coins whatever price they want!  WRONG . The market price is driven by many factors but is mostly a scorecard  for the attempted measurement of fundamentals. One thing to keep in mind is the market is always wrong but constantly seeking the truth. So, How are the Prices Calculated? Lets use a stock as an example. To keep things simple, the price the stock is determined by supply and demand. But supply and demand have their own determinants. In the case of a stock, how well a company is doing and stands to do in the future increases the value of the company, and, stock being an ownership stake in the company, this increases the value of the stock. As you know, the price of any cryptocurrency fluctuates constantly. The last price a trade was made at for that cryptocurrency is the price that it will be for the next person. There is an order book of bids and asks that people filed for c...