One of the most growing and lucrative markets are crypto markets. Many people run away with the idea of ​​making a profit by trading or holding. Both of these methods have made people millionaires in the market. The crypto market is known for its decentralized nature. This means that no one controls the market. However, in recent times, despite the market being said to be decentralized, many are said to be controlling the flow of the crypto market. They mention names like Elon Musk and some of the key players in the crypto market. However, is this true? Even if the crypto market is established as a decentralized site, do we have people who control it?

Governments all over the world are struggling to control Bitcoin as it continues to rise at exponential rates. It is done to both protect investors and raise tax revenue. Understanding and predicting the factors that drive Bitcoin’s ups and downs can help us better forecast and understand the cryptocurrency market as a whole. Here are few factors that influence the price of Crypto’s:

Supply and Demand

The increased demand and reduced supply drive up the price of bitcoin. Many people, corporations, and investors have begun to use Bitcoin as a means of conducting online transactions. Given the widespread acceptance of Bitcoin, it is fair to expect Bitcoin prices to increase in the foreseeable future.

Liquidity of Crypto

Media

The information released by the websites and media regarding the crypto market also goes a long way in affecting how the market would work. For instance, if a finance analyst makes a lousy analysis on bitcoin, many people might believe the analysis and remove their money from the market. This, in turn, leads to a gradual decrement in the value of the coin.

Let’s say you find an online news article highlighting the advantages of using Bitcoin and you feel absolutely enlightened after reading it. It’s safe to assume that you’ll be talking to your friends and family about it, and in turn, they’ll be doing the same.  It’s the same as stumbling upon that same article and thinking: “Wow, I need to get on this!” Upon reading it, you feel the FOMO (fear of missing out) and buy Bitcoin right away. At the same time, an article that paints a negative picture of Bitcoin can scare you into selling the coins you’re holding. 

In today’s age of social media, any kind of crypto news has the potential to affect Bitcoin value.

Internal Competition

Bitcoin is without a doubt the most well-known and accepted cryptocurrency throughout the world. However, there are thousands of other cryptocurrencies vying for our consideration, such as Tether (USDT) and Ethereum (ETH). Although bitcoin remains the most valuable cryptocurrency in terms of market capitalization, altcoins such as Ethereum (ETH), Tether (USDT), Binance Coin (BNB), Cardano (ADA), and Polkadot (DOT) are among its big competitors. The market cap is also a factor that can influence the currency price in this ever-changing scenario.

Conclusion

Cryptocurrencies are decentralized, the market is not. Each participant has cryptocurrencies, but absolute power over the market is in the hands of the elite controlling the significant share of total supply. Artificial “pumping” is more like an exponential graph. The same concerns the fall (“dumping”) of the course. Namely, cryptocurrencies with small trading volumes are subject to speculation most.

Internal market factors are highly applicable to short-term, volatile market speculations and “subversive” news, therefore, all those considering investing in cryptocurrencies should manage and deal with short-term wild fluctuations. To analyze the fundamentals of cryptocurrency market, long-term global factors such as legal and regulatory framework, measurement and recognition need to be taken into account as well as performance and perspectives when considering a particular currency.