Cryptocurrency, of late, has become a popular choice to get rich quick. However, the world of cryptocurrency is not very easy to discern. Inexperienced people who are completely new to this idea may find themselves at a loss. Thorough know-how of the functioning of cryptocurrency is required.
There are several factors that give cryptocurrency its economic value. Some of the most important factors are:
Bitcoin Affects Alt Coins
The most influential cryptocurrency is Bitcoin. Bitcoin affects other altcoins. When you start noticing the daily charts, you will find that often times the altcoins are moving up and down just like Bitcoin does.
Media Matters And Cryptocurrency
Whatever gets reported by any form of media has a great impact on its followers. Media can be manipulated, or recent worldwide events can stir up the world of cryptocurrency valuation. Fluctuations in prices are often dependent on many political happenings. In recent times China’s ban on ICO had a huge impact on crypto valuation.
Financial Industry Bigwigs Have a Say
The stalwarts in the finance industry pretty much decide on which currency will have a rise or a fall. They either give patronage or withdraw patronage, thereby determining the status of such currencies. People in fear of missed opportunities indulge or refrain from investing, following the industry leaders.
Path-Breaking Technology and The Growth of Cryptocurrency
Cryptocurrency is the child of advanced technology and economics. With more and more progress in the technical field, cryptocurrency is becoming easily understandable and implementable by most people. Amazing platforms with easy navigation, seamless transaction, and asset options are attracting people to dive into the world of cryptocurrency.
Unstable Political and Global Issues Impact Virtual Currencies
Factors that challenge growth and development in general are also a threat to cryptocurrency. The unstable political situation, war, or any kind of imminent danger, poses serious damages towards the natural prosperity of cryptocurrency.
Global Economic Meltdown and Failure of Fiat
Traditional money has failed in more than one way to appeal to many investors due to their rigid nature, limitations, and restrictions. Such impositions stunt financial growth immensely, making people look for alternatives such as cryptocurrency. Global recognition and few regulations put the cryptocurrency at high demand in the ensuing years.
The Choice of Hundreds of Crypto Currencies is One Factor
Bitcoin was one of the first cryptocurrencies. Even now it is the most influential and popular one. But miners are seeking other options. Investors, thus have a variety to chose from. Sometimes a new cryptocurrency emerges and investors horde to buy it, all under the influence of hype created around it. This affects the already existing currencies and vice-versa.
Relation of Cyber Security Challenges and The Crypto Charts
Cryptocurrency lies in the virtual world. It is open to hackers and all the wrong intentions. Even a minor coding mistake can upset the whole system and people might end up losing their funds. These kind of challenges pose a great danger to this type of currency. With better trading platforms which are more secure are being brought into use to ensure greater safety. Whenever a cryptocurrency becomes the victim of cyber frauds, the movement of other currencies in the crypto market gets affected.
Though cryptocurrency does not rest on fixed terms and unlike fiat currency, they are very much decentralised. Yet like any other currency, they are dependent on several factors that run the market. Keeping goals in mind, investing in cryptocurrency is the best solution. Short-term predictions are difficult to make but in the long term, the future of cryptocurrency looks quite bright.
This article was supplied by Phillip Nunn , a thought leader and speaker on Blockchain, Cryptocurrency, and Fintech – follow his blog.