Supply and demand for cryptocurrencies Back to list

Member SinceJul 08, 2021

Posts 240


Nov 02, 2021 a 02:27
Value is determined by supply and demand. When demand exceeds supply, prices rise. For example, if there is a drought, the price of grain and products rises even though demand remains constant. Cryptocurrencies follow the same supply and demand basis.
The supply of a cryptocurrency is always known. There are some, like Bitcoin, that have a set maximum supply. Some cryptocurrencies, such as Ether (Crypto: ETH), do not have production limits. There are some cryptocurrencies that use systems to "burn" old tokens to prevent the circulating supply from increasing too high and delaying inflation. Burning a token means transferring it to an unrecoverable address on the blockchain.
The demand for a project may increase as it becomes more well-known or as utility prices rise. As cryptocurrencies become more widely accepted as investments, demand increases while circulating supply is effectively restricted.

Member SinceAug 09, 2021

Posts 250


Nov 02, 2021 a 16:31
Cryptocurrency is a type of currency that operates independent of banks. Bitcoin is one form of cryptocurrency, but there are many others. These are managed by the public blockchain that enables peer-to-peer exchange. Cryptocurrencies can be traded for traditional currency, or used to pay for goods and services online. While Bitcoin was initially popular with people who wanted to remain anonymous, cryptocurrencies have now become more popular with people who want faster international transactions.

Member SinceJul 12, 2021

Posts 239


Nov 03, 2021 a 13:55
As always the forces of supply and demand rule, and this also applies in the world of crypto, even more so when considering that this market operates independently, 24/7 and online. Demand seems to be on the rise on a consistent basis, and there are several types of cryptocurrencies being introduced as we go along, and it is important as the demand needs to be met. While some have production limits others do not, and so the forces of demand and supply rule even more.

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