Do you wonder what makes crypto valuable considering its huge volatility? It is never uncommon for the most popular crypto, Bitcoin to rise up or fall down in price by 5 % or 10 % on any particular day. Smaller cryptos can face even huge swings in price.
Cryptos are never backed by a central authority in the same way as traditional currencies. No exchange medium sanctioned by the government backs it. Among consumers, government backing may improve their faith in a currency’s value. It offers a huge spender or collector of any currency. In this article cryptocurrencies are mainly decentralized; they are seen to derive their value from different sources such as production cost, supply or demand, exchanges availability, governance, competition, and regulations.
The crypto value is usually determined by supply or demand. It is similar to anything else wanted by people. If there is a fast increase in demand compared to supply, the price will rise. For instance, in case of a drought, grain’s cost and produce will increase if there is no change in demand. This same principle of supply and demand will apply to cryptos. It will gain value if there is a rise in demand higher than the supply.
If you are well aware of the main supply and demand principle, that gives crypto value and all factors that influence them, you will be able to make better investment decisions in crypto. If you feel that demand will increase for A, B, and C reasons and supply will not keep up. Then that crypto can be a great investment. Yet stay aware that the government still does not have good practices to regulate crypto. It makes it very risky. It is also a highly volatile investment regardless of anything.
The total cryptocurrency market cap has slightly increased by 2.44 % to $1.92 trillion. But the prices of many cryptocurrency tokens that are low ranked jumped more than 200 %. As per the data of CoinMarketCap, lesser popular Luniverse or LUNI topped the chart. It has a rank of 3888. Its price jumped up to $0.02088 by more than 3360 %.
Much has been talked about regarding the cryptocurrency rally in the past two weeks and so. Various cryptos saw profits in double digits. Some such as Zilliqa became a part of the headline with their huge uptrends. Why there has been a surge in the cryptocurrency market anyway is mentioned here:
- No certainty around the rate hike of the Fed that appears to die out.
- Investors crowing into cryptocurrency like a bet against the huge inflation.
- At the beginning of 2022, the downtrend provided the ideal dip for buying in.
So with all the above mentioned factors, some coins have almost rallied. But they never got any attention. Here are they:
- It is one of the prominent protocols of Defi worldwide.
- Aave has always faced a positive outlook. It was for the long-term.
- Yet the past two months were very volatile for this coin.
- This year it fell to a new yearly low.
- There was not any rebound hope.
- Even after that Aave sharply rebounded.
- The coin posted gains of almost 50 % more in the past 7 days.
- It has been the best week for it this year.
- Its story is filled with many surprises.
- Similar to other altcoins, it got routed at the beginning of this year.
- Yet it failed to see any upward pace.
- Suddenly it began to rise up.
- It maintained such an uptrend from then.
- It gained more than 50% in the last week alone.
- It is expected that it will see gains within some days.
- Yet it is quite astonishing to see the bullish breakout.
- The coin delivered 80% profits within one day.
- It rose by 180% more in the past 7 days.
- STEPN is one of the best performers in cryptocurrency now.
As per the experts, an individual must avoid investing in any lowly ranked or lesser-known cryptocurrency tokens. They are much like penny stocks. They have too much volatility and will disappear more likely if anything bad happens in the not so certain cryptocurrency market. So one must do thorough research to avoid being a fool in cryptocurrency.