Why comparing cryptocurrency prices is wrong?

Mahanton

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Quote from: mk4 on September 20, 2018, 09:52:24 PM

Quote from: khactan91 on September 20, 2018, 08:24:24 PM

Because every electronic currency goes up from a very low price below $ 1$ is normal

Definitely not. Not all(and even probably majority) of all the coins/tokens aren't guaranteed to go up beyond $1, especially knowing there are tons of coins/tokens out there that has a HUGE circulating supply. Always take circulating supply into account.

These kind of idea or beliefs had already spread out or did already became a common thing for some people who are just new and someone who do hear about to other people investing on cheap coins and later on it pumped out.Its really possible but chances would really put you just like on doing gambling and a sort of luck will really be needed. Comparing prices cant really be avoided because as an investor we would always seek out on coins which we can utilize our money on hand.

nidacoinlove

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Quote from: mostkey on September 30, 2018, 02:48:23 PM

Some people don't know what coins have the potential to rise in the future, because there are too many coins that have been registered, so slowly people's interest is reduced a little, all you have to choose is of course the top 50 coins, that's because many people talk about it, right to choose coins with prices below $ 1, the potential for coins will determine future success.

Top 50 or 100 is not always a smart choice. If someone can't go for the process to choose a coin for themselves to invest, with sorry but that person shouldn't be a part of this game. I have observed many coins that arise from the bottom to a very good rank. Being in the top rank is never a guarantee to a high profit. It's better to choose and evaluate potential coins in whatever the rank they may be.

tenakha

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In my opinion this thought has relevance with psychology so, no matter how much the price and investment are, the gain goes up as much as the interest rate of price increases. Perhaps the number of the token causes to this behavior.

Diced90

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Get'em boys

One can't compare cryptocurrency as a one to one ratio, the numbers or prices are not inter-convertible because the value of each coin is based on different factors.

mostkey

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Some people don't know what coins have the potential to rise in the future, because there are too many coins that have been registered, so slowly people's interest is reduced a little, all you have to choose is of course the top 50 coins, that's because many people talk about it, right to choose coins with prices below $ 1, the potential for coins will determine future success.

Nanbaka

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supply and demand, also the number of people using that cryptocurrency greatly affects the value, also the number of individuals or businessess accepting that cryptocurrency as payment also contributes

DedgeDoge

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Quote from: Indrawan77 on September 21, 2018, 02:25:45 AM

I understand what you mean but most of the traders expert always ask us to find a coin that cheap but got potential, when we calculate profit, we are calculating about the percentage, not the rising value, and usually an expensive coin rising percentage is not too big compare to the cheap coin, and there is chance that people will buy bulk of cheap coins, and that could rise the price quickly

You really cannot say that because every coin still will always have potentials to increase in value in the long run and that totally depends on the supply anyway.

gabmen

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Quote from: tbterryboy on September 27, 2018, 02:39:05 AM

Quote from: khactan91 on September 20, 2018, 08:24:24 PM

I think at 500$, I should invest in altcoin with great potential top 1 on coinmarketcap. Because every electronic currency goes up from a very low price below $ 1$ is normal

People need to start understanding that money would not just come from anywhere and however it is, you will still have to be able to have a good product and a proper demand for you to have a sustainable value in the long run for any market. What people are looking for is to get rich overnight, and I am not saying investing in altcoin is bad, but rather than making the quantity of the coin you want to buy a priority, why not make sure that what you are buying is actually worth it.

Exactly. People tend to look at the short term value of a coin instead of it's potential use and application. A coin's true value will present itself in time so i wouldn't worry about the price of coins such as eth, since they're pretty well established already.

tbterryboy

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Quote from: khactan91 on September 20, 2018, 08:24:24 PM

I think at 500$, I should invest in altcoin with great potential top 1 on coinmarketcap. Because every electronic currency goes up from a very low price below $ 1$ is normal

People need to start understanding that money would not just come from anywhere and however it is, you will still have to be able to have a good product and a proper demand for you to have a sustainable value in the long run for any market. What people are looking for is to get rich overnight, and I am not saying investing in altcoin is bad, but rather than making the quantity of the coin you want to buy a priority, why not make sure that what you are buying is actually worth it.

beerlover

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Quote from: slashz9 on September 20, 2018, 10:40:43 PM

i think that depends not only on marketcap, but in fundamental and techincal analize, because that two factor make the price rise/down.
specially for fundamental they make big impact for influence coin price.

Technical or fundamental analysis will not help someone who is not ready to understand that investing in cryptocurrencies is not just about the numbers but the value in real world that the market they are getting into creates or will have the potential to create in the long run and that is what totally makes it very valuable and be able to sustain its value as time goes on.

People simply pay so much attention to the quantity these days that they discard exactly the potentials within a project before even deciding to invest in it. Most times it is always just better to concentrate on coins with very solid and good projects rather than trying to just pick anything because of its quantity. In the long run, even if smart moneys want to enter a market, they look for market with potentials as long as it is in a dip state, and then they invest.

hispout

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Quote from: gokulnk on September 20, 2018, 02:13:22 PM

In many of my discussions with friend I keep hearing "I only 500USD, I can't buy bitcoin" and "Suggest me an altcoin below 1 USD". I have been explaining time and again why this line of thinking is wrong. So I thought of writing a post so that I can share it next time somebody asks that question. You can read it here https://blog.goodaudience.com/why-comparing-cryptocurrency-prices-is-wrong-2054a9075878

The gist of the post is that you shouldn't compare prices and you should compare market caps. But since Marketcaps are difficult numbers to compare I suggested using Circulation normalised prices. I built a tool which gives me normalised prices of top 100 coins for quick reference. https://dashboards.bitfolio.org/#/normalised-price

Would like to know your thoughts.

You can not buy Bitcoin with savings of this mentioned amount so you should start with less valuable coins which are here in the crypto market and people are also making money through them. For example you can start buying Litecoin with your savings which will give you more in quantity rather than buying Ethereum will give you least in quantity. Litecoin has potential as well and this suits you well.

Wiwendefak

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Quote from: shield132 on September 20, 2018, 05:06:24 PM

If your friend has 500$ then yes, he is rigjt, he can't buy bitcoin because it costs more than 6000 usd. Lol, I know what you mean. People usually hope that coins with low price have the potential to rise. Wasn't bitcoin under 1 dollar at first?
What's market cap? It's Price X Number of circulating supply, it's one of the metrics.

You are very right here, 500$ can be a good investment if he invests in low price coin! Bitcoin is not an investment coin for everyone. By 500 USD you can't buy even 0.1 BTC where if you go for low price good coin then you may have a good number of coins! There are several low price good coins available in the market! So, your profit is cinfirmed if the market grows again.

chickenado

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Quote from: Edsemen on September 24, 2018, 03:16:11 PM

Quote from: palle11 on September 24, 2018, 11:05:04 AM

If you can be lucky to get a coin that is cheap with small supply, you are good for a move but be mindful if the coin team is still active.

Quote from: shulio on September 21, 2018, 04:48:35 PM

One should compare not just the crypto currency price but also the supply. Currencies with high supply can not reach high prices.

I have also seen that this is possibly the case. Looking at top coins at the cmc, you hardly see any crossing 1billion.

Higher supply coins was too hard to pump and as per experience with those coin holdings I had nothing pumped up at very high value so far. If there's a cases that some coins to spike that high price, maybe a hype was happening but suddenly that breaks its value temporarily and be back again to normal cheaper value.

Actually we can't force the market to be stabilized since the bearish trend still moves aggressively. We might see those prices fluctuations kept behaving like roller coasters, but tries to recover eventually. But the main thing here was those panic sellers were not gaining courage to face the current challenge. Most of these people dump coins without even thinking the negative effects.

Reid

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Quote from: khactan91 on September 20, 2018, 08:24:24 PM

I think at 500$, I should invest in altcoin with great potential top 1 on coinmarketcap. Because every electronic currency goes up from a very low price below $ 1$ is normal

There is one who made the mistake already of not reading the whole post or the reason behind it.

Okay, let us say you bought the cheap coin for a dollar and you got 500 of it by now.
Do you really think it got the potential to go up? It is the same risk as making to every crypto currency. There is not much of a difference.

The real problem is people here who are in a rush to make big profit in a short span of time. I say they want it short with an exaggerated face.

This needs to stop. Bitcoin didnt make it up in just days. It went thru a lot of downfalls.

Ranly123

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Quote from: gokulnk on September 20, 2018, 02:13:22 PM

In many of my discussions with friend I keep hearing "I only 500USD, I can't buy bitcoin" and "Suggest me an altcoin below 1 USD". I have been explaining time and again why this line of thinking is wrong. So I thought of writing a post so that I can share it next time somebody asks that question. You can read it here https://blog.goodaudience.com/why-comparing-cryptocurrency-prices-is-wrong-2054a9075878

The gist of the post is that you shouldn't compare prices and you should compare market caps. But since Marketcaps are difficult numbers to compare I suggested using Circulation normalised prices. I built a tool which gives me normalised prices of top 100 coins for quick reference. https://dashboards.bitfolio.org/#/normalised-price

Would like to know your thoughts.

With $500, he can already buy Bitcoin but now as a whole. Only he can buy partitions of it. Buying in altcoins is also a good decision since altcoins has good potential to grow beyond $1 in the future.

cryptocrusher

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Neither marketcap or prices are the best for comparing cryptocurrencies. What's better is the actual features themselves. Marketcap is often not reflective of development and progress. A coin that raised 100m in ICO will still have a higher marketcap often than one that raised 5m even if the 5m one is better.

Edsemen

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Quote from: palle11 on September 24, 2018, 11:05:04 AM

If you can be lucky to get a coin that is cheap with small supply, you are good for a move but be mindful if the coin team is still active.

Quote from: shulio on September 21, 2018, 04:48:35 PM

One should compare not just the crypto currency price but also the supply. Currencies with high supply can not reach high prices.

I have also seen that this is possibly the case. Looking at top coins at the cmc, you hardly see any crossing 1billion.

Higher supply coins was too hard to pump and as per experience with those coin holdings I had nothing pumped up at very high value so far. If there's a cases that some coins to spike that high price, maybe a hype was happening but suddenly that breaks its value temporarily and be back again to normal cheaper value.

hugeblack

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Quote from: gokulnk on September 20, 2018, 02:13:22 PM

I built a tool which gives me normalized prices of top 100 coins for quick reference.

I did not try your tool but relying on market capacity is stupid, it gives misleading results and does not mean anything.
A few days ago the Ripple rose dramatically above Ether, does that mean anything?
Market capacity is a measure of central markets but does not mean anything; I can create 10 billion of shitcoin and sell it for $ 1. "above bitcoin."

If you want to build a tool, compare the price to something that has a presence and value in itself such as gold, jewelry, and Lamborghini cars. Tongue

palle11

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If you can be lucky to get a coin that is cheap with small supply, you are good for a move but be mindful if the coin team is still active.

Quote from: shulio on September 21, 2018, 04:48:35 PM

One should compare not just the crypto currency price but also the supply. Currencies with high supply can not reach high prices.

I have also seen that this is possibly the case. Looking at top coins at the cmc, you hardly see any crossing 1billion.

NeuroticFish

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Quote from: gokulnk on September 20, 2018, 02:13:22 PM

Would like to know your thoughts.

Imho market cap can also be misleading. I mean, let's just think of a token, 10 mil tokens issued, 1$ / token the ICO price.
The white paper looks good, the roadmap looks good, people starts buying. At the ICO end we have 10 mil $ market cap.
But the team is not OK. They pretend for 6-12 months they work, but they never deliver, price falls and falls. Now the market cap becomes 100k$

Or just think of a good project, but a certain exchange was sloppy and that coin was stolen, dumped and price is down. Or a good project in its early days.

Imho for a good investment you need a solid project with a solid team, for which the ICO may not be the best info, for which the market cap is not always the most accurate indicator.

el kaka22

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The problem with people nowadays who want to invest is that they are looking for quantity and not quality and this would always cloud their judgment.

They believe if they can just put certain amount of money into some altcoins with some very low value, they can just easily turn out to be rich in a short time, just like bitcoin has made some people rich over the years, but that is always a bad mentality to investment. He does not have to buy 1 bitcoin and he could just buy some little, and then put in some few altcoins alongside as the case may be.

shulio

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One should compare not just the crypto currency price but also the supply. Currencies with high supply can not reach high prices.

Indrawan77

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I understand what you mean but most of the traders expert always ask us to find a coin that cheap but got potential, when we calculate profit, we are calculating about the percentage, not the rising value, and usually an expensive coin rising percentage is not too big compare to the cheap coin, and there is chance that people will buy bulk of cheap coins, and that could rise the price quickly

slashz9

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i think that depends not only on marketcap, but in fundamental and techincal analize, because that two factor make the price rise/down.
specially for fundamental they make big impact for influence coin price.

mk4

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Quote from: khactan91 on September 20, 2018, 08:24:24 PM

Because every electronic currency goes up from a very low price below $ 1$ is normal

Definitely not. Not all(and even probably majority) of all the coins/tokens aren't guaranteed to go up beyond $1, especially knowing there are tons of coins/tokens out there that has a HUGE circulating supply. Always take circulating supply into account.

khactan91

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I think at 500$, I should invest in altcoin with great potential top 1 on coinmarketcap. Because every electronic currency goes up from a very low price below $ 1$ is normal

shield132

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If your friend has 500$ then yes, he is rigjt, he can't buy bitcoin because it costs more than 6000 usd. Lol, I know what you mean. People usually hope that coins with low price has potential to rise. Wasn't bitcoin under 1 dollar at first?
What's marketcap? It's Price X Number of circulating supply, it's one of the metrics.

gokulnk

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In many of my discussions with friend I keep hearing "I only 500USD, I can't buy bitcoin" and "Suggest me an altcoin below 1 USD". I have been explaining time and again why this line of thinking is wrong. So I thought of writing a post so that I can share it next time somebody asks that question. You can read it here https://blog.goodaudience.com/why-comparing-cryptocurrency-prices-is-wrong-2054a9075878

The gist of the post is that you shouldn't compare prices and you should compare market caps. But since Marketcaps are difficult numbers to compare I suggested using Circulation normalised prices. I built a tool which gives me normalised prices of top 100 coins for quick reference. https://dashboards.bitfolio.org/#/normalised-price

https://cdn-images-1.medium.com/max/1000/1*mYAEhO1hB6PnADB5C1hh7Q.png

Would like to know your thoughts.

Topic: Why comparing cryptocurrency prices is wrong? (Read 309 times)