WHERE THE HELL DOES THE PRICE OF A CRYPTOCURRENCY COME FROM?
Many people wonder: who sets the price of a cryptocurrency and why does it change so quickly? The answer is simple: it all comes down to the capitalization of said currency. Let's see how it works:
Market capitalization: In the information of a cryptocurrency, you will find the “market capitalization”. This figure represents the total value of all coins in circulation.
Circulation supply: This term refers to the number of cryptocurrencies in circulation, that is, those that holders can use at any time.
Coin price: If we divide the total capitalization by the number of coins in circulation, we will obtain the current price of the cryptocurrency.
But why does this price change? Here are some reasons:
Sell-off: When holders of a cryptocurrency decide to sell a large amount of their coins, the value drops abruptly. This is reflected on the charts as a descending line.
Whales: Whales (large investors) can influence the price. If they buy or sell large amounts, the cryptocurrency rises or falls.
Manipulation: Cryptocurrency promoters sometimes withhold large amounts. Internal fights or external decisions can affect the price.
Solid projects: A good project will attract investors and increase the price.
Rumors and delistings: Rumors about delistings on platforms like Binance can cause people to sell, affecting the value.
In short, the cryptocurrency market is volatile and unpredictable. Sometimes all it takes is the flutter of a butterfly's wings to make a cryptocurrency rise or fall.#pepe⚡ #Dogecoin #Shibalnu #Bitcoin #solana $XRP
