We’ve talked about many things crypto in the past months. But there’s this other subject that always seems to be playing a role. In any sphere, in any kind of relationships. And that’s money. Because money makes the world go round.
Price vs value of a cryptocurrency unit is very often overlooked by people buying cryptos. The question is: what exactly is the difference between those terms and how are they formed? The fact is digital world needs digital money. But let’s get a closer look on the whole subject of money, price and value.
Contestant 1: The Price
Let’s start off with the easy.
The price.
The financial value aka price is something that the public agrees to pay for a specific cryptocurrency in question. For a crypto coin. It can fluctuate a lot depending on the volatility. Currencies that are volatile are shifting a lot more.
Users and merchants are a bit put off by this as you can never be sure of what’s the price of a coin is going to be the following day.
Although, some people see the broader picture here. They understand that there’s an opportunity for an income in this.
The most popular way to make money with this is day trading.
And, what is that, you ask?
Funnily, this phenomena is also the source of the “buy low, sell high” mentality. Most people lose or don’t make any money with this scenario. This, of course, doesn’t mean that it’s not possible (at all) to earn income with day trading.
The truth is that a lot of people are reaping the benefits of day trading. But that requires a vast amount of knowledge and mad skills. Which is all doable in due time. You need to focus. And a bit of patience.
Contestant 2: The Value
When it comes to cryptocurrency, the value is much more important than the price. At least in our opinion. We urge people (always!) to ask the right questions, i.e., what the value is. Instead of what’s the price, when looking to buy cryptos.
The value has much deeper roots, and meaning than the price does. Actually ‒ cost is one of the main contributors to the price. It can even be said that the price (of cryptocurrency) is the perception of its value. This means that as more people trust, support, believe and see value in a specific cryptocurrency, the more the price grows.
It’s crucially important to investigate the cryptocurrency before buying. This is something we always stress when it comes to purchasing crypto. Knowledge is power. Don’t buy a pig in a bag. It’s all about the value.
Last but not least, ask yourself (or others) these two questions:
How much work and effort is put into making a reliable infrastructure and ecosystem around the coin?
How convenient it is to use it and what tools and platforms have been created to support the coin?
Who wins?
Well, we’d like to think it would be the value. This is part of the big end goal we’re trying to reach.
Come, join the movement and let us make a change!
For further reading, go ahead and check out our blog post about governments and money and get acquainted with the evolution of money.
Is cryptocurrency up your alley? Don’t be a stranger. Get in contact!
Originally published on our dagcoin.org webpage on August 22, 2018.