What is it exactly that makes value to a coin?
I see for example, Ripple has a marketcap of $ 2,625,623,101 but it's only 0.026 cent for 1 ripple, while Litecoin has a marketcap of $ 572,859,937 and 1 ltc is around 23$. It is because of the numbers of transaction, the number of miners, total members... ? Or is it because ripple has a total supply of 99,999,998,252 XRP and Litecoin as an example only 24,312,642 LTC? Very newbie question for most of you i guess but yea
Grtz,
I see for example, Ripple has a marketcap of $ 2,625,623,101 but it's only 0.026 cent for 1 ripple, while Litecoin has a marketcap of $ 572,859,937 and 1 ltc is around 23$. It is because of the numbers of transaction, the number of miners, total members... ? Or is it because ripple has a total supply of 99,999,998,252 XRP and Litecoin as an example only 24,312,642 LTC? Very newbie question for most of you i guess but yea
Grtz,
Since it's not backed by a physical commodity. The value of cryptocurrency is derived from the relationship between supply and demand. The supply side is determined by the original dev's specifications for production of the coin, in conjunction with the ability of individual(s) ability to produce that coin. Rarity, in this instance, is what has attracted so many. On the demand end of the equation, it is determined by the usability/utility of the coin in addition to the speculative value --that is, the value each individual, and therefore the collective market, place on it for their myriad reasons. The ability to make fast, quasi-anonymous payments across the globe for low fees is what attracted many to Bitcoin in its infancy. Obviously, it has presently grown past that seemingly single use as proven by its recovery from the closure of a certain large black market website.
more supply and less demand = cheaper coins