What Determines Crypto Price Live?

The market of digital coins is expanding, meeting more and more crypto assets and projects. Looking at the ranking of digital coins’ presence on the Coinmarketcap resource, we can see the assets are placed in order from the coin with the most significant capitalization to the coins with the lowest cap indicator.

Three main parameters determine cryptocurrency market prices:

  • Price
  • Market capitalization
  • Trade volume

The top cryptocurrencies by market cap:

  • Bitcoin
  • Ethereum
  • Tether
  • BNB
  • USD coin
  • Binance USD

Why is a market cap so important? The market cap indicator shows the total value of all the coins in circulation and is calculated by multiplying the current price by the number of assets released and put into circulation. So the higher the assets rate, the more the market cap. Now let’s talk about price and what it depends on.

Factors that Determine Crypto Price

Here are the main factors that affect crypto rates:

  • The ratio of supply and demand directly impacts the price. The lower the supply (the number of tokens), the bigger demand, and vice versa. It works similarly to traditional markets.
  • The essence and application of coins. If it is an “empty” coin with no technical load, there is no application or real use case for it. If it is a highly technological asset with a practical application, it is used by other projects and expands its use cases.
  • The entire crypto market trend. For example, when it is a bear market, all assets drop, and you can’t do anything with it.
  • Reputation of a project that releases coins; partnerships, supporters, backers, etc. (an example with the FTX exchange and FTT token brightly demonstrated this factor).
  • News background

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