Blockchain

What Determines the Price of Cryptocurrency?

Cryptocurrencies are finding that exist on the Internet space but can have the same applications as traditional money we are all used to. For example, you may use your digital wallet to pay for services and goods in companies and firms that accept this payment method.

Crypto platforms are also used for fast and secure cross-border money transfers, helping avoid lengthy and expensive bank procedures with numerous middlemen.

The main use case for digital assets is trading due to the high volatility of the crypto market. Actually, that is the main difference between digital assets and traditional finances. Traditional currencies are issued by central banks, and their emission can be artificially increased or cut by the state’s order. Central banks report to state governments, so there is a central regulatory body that controls traditional finances.

On the contrary, digital assets are not subject to governmental control or central banks. Of course, crypto platforms comply with regulatory requirements, but essentially crypto coins rates have nothing to do with central banks or states.

Since the crypto market is not controlled by any central authority, it makes it incredibly volatile, which opens enormous earning opportunities for traders and investors, allowing them to earn on price fluctuations in different time frames:

  • Traders can conclude short trading deals by buying and reselling digital coins, taking profit from the slightest rate changes in a matter of minutes many times a day. That is called the scalping strategy. So taking advantage of small volatility, you can receive a profit many times a day.
  • Traders may open positions that last 24 hours and take a profit from the changes in the price that occurred during one day.
  • Trades can last for a few weeks, which is called swing trading strategy, or a few months or even years, which is called “buy and hold”.

What Affects Cryptocurrency Rates?

The price for crypto today is rarely the same as it was yesterday. So what drives them up and down? Here are some factors that impact cryptocurrency rates:

Factors:

  • Supply and demand are the key factors in the market of digital coins. The market is still very young and fragile, and people are very sensitive to market trends. So when a couple of large investors sell cons, it causes their price to drop, and other people follow their example, leaving the market and dropping demand. The number of coins in circulation also matters because if there is an unlimited number of coins, the demand for them is low; thus, the price is also low. When the supply is limited, it helps to keep the price at the same level.
  • Local laws and restrictions. Some countries are more loyal to crypto assets, which are mostly Azian countries. Due to increased demand for digital assets in Azia, crypto prices on their local exchanges may be somewhat higher than on European platforms. China used to be a crypto-friendly country as well, but a couple of years ago, it banned mining and imposed restrictions on crypto platforms, causing the migration of miners to other, more friendly countries of the world.
  • The market trend. The cryptocurrency market lives by cycles, and it is quite normal for it to demonstrate up and down trends, which already got the names of bull and bear tendencies.

When the bull trend starts, the agitation around crypto is growing, demand is increasing, and even those who have nothing to do with crypto want to buy it. When the market reaches its peak, it starts to move down. There are a few stages of the process of transition from the bull trend to the bearish one. The bear trend is an expressive period when people massively leave the market. That happens like a snowball – large investors get rid of their assets, price drops, and other investors see that and follow, dropping prices even further. There is no asset that would remain at the same price level during this market trend.

  • News background. The two bright examples from recently. When the Binance exchange blocked BTC withdrawals because of the mistake, the BTC rate dropped, even though the clocking was temporary and nothing critical happened. Another example is the FTX exchange collapse. The news about its bankruptcy shook the whole market, and it again dropped. In another situation, for example, when Elon Musk posts a tweet on how much he supports Dogecoin, the asset’s rate skyrockets.
  • Naturally, the overall situation with the world’s economy affects the crypto market. Since the beginning of the full-scale war started by Russia on Ukrainian territory, all industries have suffered, and crypto is not an exception.

Nevertheless, the crypto market is still popular, and during this bear trend, it is worth selecting worthy assets for investment and buying them to hold long term. Let’s see where you can find live crypto prices and buy crypto.

Where to Watch Live Crypto Prices?

To keep a track of crypto prices you may visit the popular resource Coinmarketcap where you can place the assets in the order according to their market cap or price, see their charts and pick a period to track their changes on the graph.

If you want to trade cryptocurrencies, you need to find a crypto exchange that would offer trading tools with charts. One of the largest platforms that offer crypto prices in real time is WhiteBIT. It shows price charts for every asset supported, so you can track the price here and now and make directions on your next trading steps.

Let’s take a look at WhiteBIT’s advantages:

  • It is one of the simplest trading services ever. Even a beginner user handles its interface quickly. There are interface versions for novice and advanced users. Also, you can configure the interface, leaving the tools you use in your account. The same works with the mobile application.
  • It is one of the safest crypto platforms. WhiteBIT has checked its vulnerability and underwent an audit. It complies with all the requirements in the crypto industry imposed by regulators. Every user can configure a two-factor authentication to make obe’s account as safe as possible and protect it from third parties. The platform keeps 96% of funds on cold wallets, making it just impossible for hackers to reach.
  • The exchange is regulated, so all the users willing to access advanced trading tools and unlimited withdrawals must pass KYC. It takes a couple of days to complete the procedure – the WhiteBIT team does its best to check every new user as soon as possible, providing quality checking at the same time.
  • Users who do not want to pass verification may also use the crypto exchange, but they can only trade on the spot market.
  • Advanced trading tools on WhiteBIT include: trading with leverage up to X20, margin, and futures trades.
  • Additional financial instruments are crypto lending and staking, allowing users to earn passive income from holding digital coins on the platform locked.
  • It is likely that you will find any crypto to trade on WhiteBIT, for there are over 450 pairs available.
  • Depositing an account with fiat money is possible for registered and verified clients.

To watch cryptocurrency prices today on WhiteBIT, you may use the crypto converter. It asks you to enter the currencies – the one you want to buy and the one you want to sell. The calculator will generate the latest relevant crypto rate in a matter of seconds. Crypto prices on the exchange depend on the demand and supply balance on it. basically, WhiteBIT has high liquidity, so rates on it are always around the same levels as on other large crypto exchanges.

Wrapping Up

There are many internal and external factors that impact the exchange crypto price. A successful trader is one who can analyze those factors and react to every market trend change. To keep track of live crypto prices, traders use charts offered on crypto exchange platforms. The charts allow traders to investigate the price behavior during different market trends and find patterns and historical indicators. This data allows for forecasting the future crypto rate behavior and, based on it, building the future trading strategy. So we conclude that price analysis is a key to successful trading on the cryptocurrency market.

If you want to learn more about digital assets and how to generate income with them, welcome to the WhiteBIT blog – a comprehensive resource with educational articles and step-by-step guides. Follow the guides and make your first steps on crypto trading on WhiteBIT, and if any questions arise, feel free to write to the WhiteBIT customer support chart.

To Top

Pin It on Pinterest

Share This