Cryptocurrency prices are probably the most frequently changing rates of all exchange goods. They vary more than shares, fiat currencies, commodities, bullion and other assets. The reason for this is mainly the lack of any institutional regulations of this market and the specific characteristics of each cryptocurrency. The incredible dynamic of digital coin rates may discourage investors from risking their money. Still, their astounding rises create surges of excitement which can make you forget your logic. How do you keep your cool and use logic to invest? Read on to find out!
What determines cryptocurrency prices?
The cryptocurrency list price is determined by many different factors. We will describe them in this article. It is safe to say that the price of most altcoins (every cryptocurrency other than bitcoin) depends on the bitcoin rate. Cryptocurrency fans say that BTC “pulls up” the valuation of all other digital coins. This basic principle is mostly true, but it doesn’t come without exceptions.
Cryptocurrency list – prices which don’t follow the bitcoin rule
The deviations are cryptocurrency prices which managed to become independent from the bitcoin rate. They stay at higher levels even when BTC drops. There are also some tokens with a fundamentally low value. Their rates drop regardless of bitcoin’s skyrocketing price.
Popular and valuable digital coins
The first group of cryptocurrencies are coins with solid foundations. They make up highly functional and popular systems. Many large institutions and private corporations have invested in them. These cryptocurrency prices are independent from bitcoin because of their reputation.
Cheap cryptocurrencies with little or no value
The second group are tokens unflatteringly called shitcoins – money with practically no real value. They are usually pretty much worthless. They’re formal creations, not actual, practical cryptocurrency. These projects sometimes experience value growth, but their high crypto rankings usually don’t last long.
As you probably already know, cryptocurrency prices can behave surprisingly. Some crypto ranking trends are completely unpredictable – you never know which cryptocurrency becomes autonomous from bitcoin rates. However, this potential can be positive or negative.
Unprosperous crypto ranking trends
Below, you will find some examples of digital coins which partly gained their autonomy from bitcoin. We will start with some crypto ranking trends which were completely unaffected by the recent rise of BTC value.
Unprofitable cryptocurrency list price:
- game credits (GAME) – a platform which supports game developers and the NFT token trade; this might be one way for using tokens, dressed in pleasant graphics, but there’s not much more to it. It’s not listed on many exchanges – only on Bittrex and BitBay, where the market for this cryptocurrency appeared only recently. The GAME cryptocurrency price stays at a fixedly low level, despite large surges in other asset rates.
- tenx (PAY) – even though this Singapore project started off well, it received a hard blow from its partner – the Visa corporation which took them by surprise and refused to cooperate further. This event was the main reason why tenx suspended its activities for some time. Unfortunately, even the recent revival and the rise in cryptocurrency prices didn’t help this coin much. The PAY token rate remains lower than its price during ICO.
- neumark (NEU) – the token of the blockchain technology financial investment platform. This is another example of a project which stays unaffected by the rising bitcoin price. The NEU rates stay at the same low level, despite the changes of other cryptocurrency prices.
Profitable crypto ranking – cryptographic currencies with rates which rise even when BTC drops
Let’s dive deeper into the world of cryptocurrencies which did not suffer from the rises and drops of bitcoin rates. These cryptocurrency prices sometimes did not react at all to the declines in bitcoin valuations, or they dropped only an insignificant amount.
Crypto ranking – popular and valuable cryptocurrencies:
- Ethereum (ETH) – the coin of most famous smart contracts and decentralized applications platform. This cryptocurrency price has frequently shown an independence from the BTC rate. Of course, this was always with a certain consideration of bitcoin’s price drops.
- litecoin (LTC) – bitcoin’s lighter and cheaper sibling. It proved its independence from the BTC prices during the 2017-2018 rate rise. LTC behaved much more dynamically than its bigger, older brother.
- ripple (XRP) – the interbank network cryptocurrency. It retains a certain autonomy from the bitcoin cryptocurrency prices which was most clearly visible during the last big rise of cryptocurrency prices of the years 2017-2018.
What are important factors in cryptocurrency price rates?
Ok, but what determines cryptocurrency price in the first place? If they are not linked to bitcoin valuation, what drives their rises and falls? Also, why does the BTC rate itself fluctuate? The market ranks each coin’s value based on its foundations – the unique characteristics of each cryptocurrency, e.g. their practical function or future predictions.
Other fundamental characteristics of digital coins are:
- accepting the idea of constituting an alternative for traditional finances,
- accepting a cryptocurrency by important institutions and technological or financial corporations.
Speculations as the driving force behind cryptographical assets values
Stock market speculative assets are also cryptocurrencies. Therefore, these cryptocurrency prices are based on the rate manipulations of the traders themselves. To put it simply, this means that having large cryptocurrency resources and traditional money, some people can cause the rises and drops in value of certain coins. This is possible to achieve by applying the rules of stock market functioning.
Cryptocurrency prices and speculations in reality
Cryptocurrency prices will drop if an entity or person starts selling significant amounts of assets and will similarly increase when a large amount will be bought. This procedure is easier achieved within markets of a low liquidity but you can observe such actions even with BTC.
How do famous people affect cryptocurrency prices?
An important factor which influences crypto ranking trends is media hype which can come from various different sources. For example, it can be caused by a famous person’s statement aired on TV or spread across social media – especially if it’s a particularly influential or simply well-known and respected celebrity.
Elon Musk and the DOGE rate rise
Such a case happened even recently. The American billionaire and celebrity Elon Musk tweeted some of his opinions, which had an incredible impact on the dogecoin (DOGE) prices. These changes had no roots in the cryptocurrency’s foundations, predictions for its future or current bitcoin rates.
Cryptocurrency price predictions – how accurate are they?
Cryptocurrency price predictions are difficult to make accurately, just as the case is with any other stock exchange assets. Many investors have an excellent knowledge of technical and fundamental analysis, as well as extensive experience in observing changes in the cryptocurrency prices caused by media hype.
There are also specialists who predict the actions of the biggest speculators in the market. They take advantage of the changes those people cause in the cryptocurrency prices. However, these predictions are often wrong. Their results seem to depend mostly on chance.As you may have determined for yourself by now – cryptocurrency prices are a delicate and unpredictable matter. They can change as a result of many different events which can rarely be controlled by investors. That’s why, if you wish to invest any of your savings in cryptocurrency, the most important thing to do is to thoroughly educate yourself on the stock market rates. This will help to secure your money against any losses which may be caused by the incredibly unstable cryptocurrency market.