How are cryptocurrencies priced initially?

Prabhuvinod

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Quote from: deadsilent on August 28, 2017, 06:30:01 AM

The more the supply the lower the price.

okay.. but what I am asking is: "How is the initial price determined when the coin is introduced to the market initially?"

Once it is in market, the relative supply, demand and (total marketcap)/(total coins in circulation) determines the price.

But "How is the initial price determined when the coin is introduced to the market initially?"

And also, there is NO ICO. So no initial money backing. Imagine that the coin is only distributed by airdrop and mining.

Thank you

trumper

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A coin is priced by the money which is invested in coin by people I mean market cap. I think supply and price is nominal, market cap is real factor.

BitcoinHodler

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HODLing is an art, not just a word...

Supply and Demand.

but what this means is a bit complicated!
Supply is the coins that are on the market, or are being sold. not just the number that statistics show as the "supply". sometimes these two numbers are the same and sometimes real supply is lower. because of premine and other reasons.

the demand is the money that is willing to buy the coins on the market. but it can also be fake too, like the fake walls they put up a little deep that will never be filled but just make the illusion of a demand! or the pump and dumps where a pumping group start buying that coin (fake demand) and causes a fast rise.

but anything fake also has a short lifetime too. the reality will hit the market eventually. you can see this in the form of pumped altcoins getting dumped hard and all those fake walls and FOMO buys vanish into thin air and be replaced by huge sell orders that clean up orderbooks fast.

X-ray

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Quote from: Prabhuvinod on August 28, 2017, 04:21:29 AM

Hi all,
I am new to cryptos and I have a very basic doubt(may be it is stupid) Huh

For the tokens and coins that had ICO or funding, the value/price of the coin will be backed by the money from ICO/funding.
But how are the coins like DeepOnion which only airdrop and mine the coins get their value?

I am confused.. How will the exchanges decide their price?

Thanks for explanation, in advance.. Grin

There are two methods to describe the price of each token after the fundraiser already successful, the first you can try to divided the total amount already collected by the team and try to divided it with the total supply of the token or the second it already described by the fixed price at the token sale.

dreamer81

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There is actually only 1 factor determining the price of an altcoin, it's something that drives the prices of everything in this world from milk, to meat, to houses, to crypto...

SUPPLY AND DEMAND

deadsilent

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It's on circulating supply of tokens. The more the supply the lower the price. The lower the supply, the higher the price. That's how it's done mate. Let me give an example. Dogecoin, 100 billions of coins circulating at 2015. Now look at it's price right now. It is on 40 sats. It's so undervalue and the problem does not ends there. Every year they are adding another 5 billion of tokens. That's bad. It will be dead soon.

Backupnime

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Quote from: Prabhuvinod on August 28, 2017, 06:20:49 AM

Quote from: Shateriere on August 28, 2017, 05:28:41 AM

crypto are priced by speculation. speculation is based on the potential of coin or amount of money collected in ICO

ohh.. I somewhat understood thats the case for ICO based tokens.

But my doubt is: "When there is no ICO(coins are distributed through airdrop and mining), how is it's initial price decided?"

yes i have the same questions with you, untill now i don't know about it.

Backupnime

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homt.net

how many the coin supply, community the coin, developer the coin, that a few factor.

Prabhuvinod

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Quote from: Shateriere on August 28, 2017, 05:28:41 AM

crypto are priced by speculation. speculation is based on the potential of coin or amount of money collected in ICO

ohh.. I somewhat understood thats the case for ICO based tokens.

But my doubt is: "When there is no ICO(coins are distributed through airdrop and mining), how is it's initial price decided?"

Shateriere

newbie

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crypto are priced by speculation. speculation is based on the potential of coin or amount of money collected in ICO

Prabhuvinod

newbie

Activity: 18

Merit: 0

Quote from: styca on August 28, 2017, 04:39:18 AM

Total supply plays a part, as does mining difficulty, and also the faith that people have in the project.
If there is a huge supply, or mining is very easy, or (worst) people have no faith in it, then this would be reflected in a low price.
But yes, until a coin is tradeable then this is all just a guide. Ultimately the market determines the price.

Thanks for reply..

I understand "Total supply plays a part, as does mining difficulty, and also the faith that people have in the project." part.

But how is the actual price decided based on above criteria?
Who will determine the price? Exchange? Creator of coin? Miners? Users?

Is there any standard criteria?
Like:

Total supply should be in range X,Y.
Mining difficulty should greater than Z.
Minimun number of votes are required to be listed on exchange at specific price

styca

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Total supply plays a part, as does mining difficulty, and also the faith that people have in the project.
If there is a huge supply, or mining is very easy, or (worst) people have no faith in it, then this would be reflected in a low price.
But yes, until a coin is tradeable then this is all just a guide. Ultimately the market determines the price.

Prabhuvinod

newbie

Activity: 18

Merit: 0

Hi all,
I am new to cryptos and I have a very basic doubt(may be it is stupid) Huh

For the tokens and coins that had ICO or funding, the value/price of the coin will be backed by the money from ICO/funding.

But how are the coins like DeepOnion which only airdrop and mine the coins get their value?

I am confused.. How will the exchanges decide their price?

Thanks for explanation, in advance.. Grin

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