Topic: What determines the price of a Product or Coin? - page 2. (Read 549 times)

On the ground of low demand, diminishing return is a factor that determines reduction in prices of most products. When the demand gets higher than the production rate there'll be an increase in price, then sooner the commodity now becomes scarce and buyers begin to go for its substitute, so at the next season of production the former expensive product may not interest people anymore, and the producers will have no option than to reduce the prices to attract consumers. And when more people turns to it again, the price increases, and repeats similarly.

Yes, that apart from the high side, there is also a fall in value because people are also selling later on for the profits, as it was mostly the profit is their reason for being here. For those who didn't, they are those who are genuinely interested on the technology that is behind the currency. Not all here are successful of hodling and selling on their targets because like you said, apart from hypes there are also news (negative ones) or FUD, that can make them worry, panic and sell early even at a loss.

Bitcoin has been over a decade old now, so I won't say it is the fastest-growing currency or product, however if we are only talking about its value, it is acceptable due to its limited supply which helps the coin to rise higher than most currencies and other products out there. He was talking about marketing there but I think BTC isn't marketed in the past but it is amazing on how it find a way to the people.

This is only the power of recommendation. People are so overwhelmed about BTC after they discovered it and they think it would be a good idea to share this blessing to others. Traders doesn't really care about the use case of a project but they can still consider it, thinking it will get a demand due to its usefulness.

He isn't wrong but it can't apply to all crypto coins. IMHO, what OP described above can be applied on fundamental coins only. Meanwhile for meme coins with have no fundamentals, they have nothing to do with products, MVP, or the like. Meme coins are only focusing on the hype, so it is only about how the marketing will work effectively. In many meme coin projects, they have the marketing teams that popularize a lot the meme coins. So, it can attract the people's attention. That's why we often saw a group of meme coin armies.

Basically, all coins depend on the supply-demand. The marketing strategy is only aimed to increase the demand of the coins.
Anyway, in meme coins, they even have no products but they have big supply. So, the price of meme coins are mostly very cheap. The high supply is one of the reasons why there is no meme coins having an expensive price. I never saw a meme coin to have a price above $1.

* Good quality
* Utility/usefulness

These two would really be that primarily be the things that needs up for a project to make its price to be valuable and its not something
that could really be that ignored upon but of course it will really be needing up some sort of hype and interest of a strong community and with some mix of those
whales who would really be that getting interested on such project,because if we do really tend to look up with some shit projects or even with memes
on which it do really able to reach out those multi million or even billion mcap because of some hype and whales pumping out.

This is what makes that really that hard to predict on what project will really be pumping into the moon just because of these factors.

I'm not sure if it's appropriate for you to use product in this case because there is what is called general economic factors and there is what is called special economic factors and this is only a factor to the product itself. If you are talking about factors ttat determine the price of a coin, then you don't have to do the comparisons to general product because what drive coins is entirely different from what drives other products.

Some of the bullets you mentioned are true on the surface but deep down, coin price is much more than what you discuss. On a normal circumstances, what you mentioned are okay but you forgot there is much manipulations on and how they affect the price of a coin, the quality depend on the hype you know, even coins that are useless are hype as good just for them to sell in the eyes of the investors.

We can't compare about Bitcoin though, in the beginning there are no marketing about it, majority of us haven't heard of it when it started, it just grow overtime, thru word of mouth as internet is fairly young that time. And what separates it is that is started everything this whole crypto revolution. And even if it was promoted around 2017, still there are a lot of skeptics and there are a lot of negatives about it.

As compare to some altcoins that followed suit, yeah they could have like airdrop like Ethereum who become the cornerstone of altcoin markets. And then we have Litecoin, touted as the young brother of Bitcoin. But now it's totally different on how developers market their product, there are hype and they try to reach out to as many possible investors as they can.

You have made made good points and any product that has one or two of the would definitely have a good price in the market. But one thing that I consider as an important factor before deciding how much I pay for a product is the Utility/use cases. Of course if there are use cases of a particular product it will definitely create the demands for that product which will increase the price of the product as time goes on. I won't pay much for a product that doesn't solve any problem. Good quality and long lasting also comes in for me. The first three points listed are okay for me in deciding how much to pay for a product.

The factors that the OP stated really determined the price of a product. Because those factors are to be consider whether a product should be purchased in higher rates or lower rates. For instance:

GOOD QUALITY: if a supply has good quality to the consumers expectation, they will patronize the products within themselves and a lot of individuals will demand the product, they will not hesitate to pay the price no matter how higher it is.

UTILITY/USEFULNESS: the more the consumers find it useful and also witness the good and experienced the quality of the product the more they will demand for it, no matter how higher the price is. as long as the product doesn't lose it functionality.

HARD/EASY TO PRODUCE: The more energy and time it requires to become a product, the higher the price. The less energy and time it requires to become a product, the lower the price of the commodity. If the producers spent a lot of time and effort, and also use quality or expensive Raw materials, supplies and inputs in making the products, then it will be sell in higher price.

SCARCE/ABUNDANT: if a lot of people are demanding a particular product, and the product is less available(demand becoming greater than supply)then the product will be hard to find(scarce) and it price will rise higher. and if the price rise higher, the demand will decreases. Just as Law of demand stated "as the price increases demand decreases".

You have given good examples in terms of regulations however I would not say that Elon Musk's tweets have that much affect on bitcoin. On memecoins, yes it is easily affected by things like social media hype but Elon Musk does not have that much control over bitcoin that he can just tweet something and the market moves toward it. Dogecoin is the only coin I know that can be heavily affected by Elon Musk.
Unfortunately, some projects do not even have that much technological excellence to be valued high. It won't last long but it can certainly get expensive prices just from hype and community support alone.

This is exactly what get some products there edge against orders, the type of marketing and the investors there all so go a long way, for example bitcoin became a currency or product with the fastest growth rate at the moment as many investors are coming, the reason been that it solves the problems associated with the current traditional market. So every product coming in must try to break this niche and then when they get the attention the demand will actually be factor to increase the price.

Taking cryptocurrencies into consideration you will see even Altcoins coming through what the first tend Fi get is go with the trend and also get top or former successful project builders on their team and then it grows the price through demand. Look at this Alticoin called Solana; some Altcoins or shitcoin traders actually started to turn their attention to it when they found out that it uses less fees and it trading memecoins were a bit faster than Ethereum. This pushed the price of the coin from around $20 to $180 in less than a year, although I don’t fancy Altcoins but it tells you that once you can market the product well the price will be base on the demand

OP, the factors you mentioned above are no doubt what's responsible for the price of a product or coin to be on the increasing side but bringing all these factors to coins, you will begin to realize what pushes a coin to be high side or has a fall in price is because of the hype or news given about them on social media that got people to invest or dump it the more in the market, affecting its price.

Most investors we have this day in the cryptosphere don't even know about the utility of the coin they are investing in. What they are after is its quick profits and the hype the coin they investing in is receiving in the market. Every other thing about the coin they don't care to know about it

You said a lot if we factor in just the product but as for crypto coins, there are many hidden things that determine the price of coins. The demand and supply of a project determined how big the coin price will soar, the team behind the project if they have any reputation before the launch of tbe coin and how they developed the project, the way trend of the project if it's a new trend or just another repackage coin that is already in the market.

There are hidden features that I think we need to look into and they are not discus at the base level of the coin price, you have to use extra eyes to see this metrics, some involved chain analysis. There is high manipulation in crypto price and its because of the coin circulation, there whales and market makers that don't look at the base metrics, the metrics may be quack but the price can still be manipulatd to how they want it to be even though the project is rubbish. This may not apply to other products but coins specifically.

I agree about marketing. The better the marketing, the more convincing that the people will buy the product regardless of they need it or not. At the same time, the advertiser is also one of the reasons why a person buys a product. So, a good choice of the advertiser for the marketing is also one of the reasons why the convincing becomes greater and with that, the demand gets higher. But I believe that this is only a secondary thing about the valuation of the product.

The entire costs really differs per area and with the logistics, materials, manufacturing and stuff, that's how it is being determined based on how it's made. But with that, the category of marketing will get into the attractiveness of the product based on how it was marketed and advertised by the company. That's also giving the brand to have more value because of how much they're paying for their brand to get these deals with good marketers and endorsers.

I'm sorry, but i have to argue if you're a little bit wrong. This is because almost all of factors above were not really applicable to the meme token. And it seems to me you don't pay attention to the meme token.

A meme token's price fully depends on supply and demand. It ignores all the factors you mentioned. It lacks quality, is easy to produce, and is in heavy supply. But, these days, meme tokens gained more attention than utility products or coins.

Marketing.

Sometimes people don't even need a product, but they still buy it because they are persuaded by propaganda. Moreover, this propaganda also helps boosting the price of the product to unreasonable costs. Take Iphone for an example. It's not necessary to swap from model to model each new year paying a fortune for it, but people still do this because it's a matter of social and financial status.

Their necessity isn't to use the product itself, but to boast themselves to the social group where they are inserted.

When I purchase products that we need, I usually look at the quality of it. The longevity and sturdiness of it are bang for the buck. That's why I don't buy asap and still need to conduct some research and comparison of prices. If my needs suit the cheaper quality of the product and it's fine for some temporary use, I'd consider that. But for most of my things, I always look after the quality and compared to the cheap ones with daily use of the products, compute how much you'll save when you buy the quality ones than the many times of cheaper ones but lesser quality.

However, the first thing I consider before buying a product is its usefulness. I don't want to spend money on a product I don't need. Second, the quality of a product also matters to me, and most times, quality items are durable. Attractiveness, size, and ease of use are not usually under my consideration.

Government policies also play an important role in the price of a product or coin. If the policies of a country favor a coin, the price might increase. There have been speculations that if Trump wins the US elections the price of cryptocurrencies might skyrocket.

No need to make it complicated. Only supply&demand determines an asset’s price. Remember though, price and value are not the same thing. Since you said “price” in the title then it is what it is.

Buffett has a nice quote about that one:

“Price is what you pay, value is what you get.”

Some shitcoin might do a x100 run in a week. Its fundamentals ain’t no important. If the majority of the supply is in one guy’s hands, the price can go anywhere.

That’s why I try to invest in assets that have intrinsic value. I don’t like to speculate. When it comes to intrinsically valuable digital assets, you can’t simply beat bitcoin.

Quality only can be assess in practice. It's hard to assess it accurately on white paper or pitch deck that is easily polished by project teams to mislead investors.

Projects can promise with utility but people have to consider other things like is it safe for their money to use that cryptocurrency?

Long lasting means that cryptocurrency survives through many practical tests and many hardest times of the market, so if it managed to survive, it is good evidence of survival strength, quality and adoption of that cryptocurrency in societies.

Not true. Bitcoin Cash, an altcoin, with bigger block size than Bitcoin, has worse reputation, smaller adoption, and lower price than Bitcoin.

It is considerably less safer to use Bitcoin Cash blockchain for your fund transfers.
https://howmanyconfs.com/

When it comes to altcoins the main thing determining their "price" is hype and the pumping team's capability to maximize on that potential. Note that it is about price not value because value is only determined by utility while price can change based on a lot of things and most of the time it is not sustainable (like in the case of pumps).