Cryptocurrency markets have seen a significant drop in value over the past few days. Many investors and speculators are feeling nervous, and for good reason.
Major cryptocurrencies like Bitcoin, Ethereum, and XRP have all dropped more than 10% in the last 24 hours at the time of writing this article. For example, Bitcoin is down nearly 12% and sitting around $10,700 at the time of writing this article.
Given that the market is experiencing such a large drop in value, many are wondering: how much money is being lost? How many dollars or euros or whatever other currency equivalent is the cryptocurrency market losing in value?
Well, there is some good news: you can’t really lose more money than you put into something.
Bid price
The bid price is the price at which a cryptocurrency seller wants to sell his or her tokens. The seller will only sell his or her tokens at the bid price or lower.
For example, if the market price of a cryptocurrency is $1,100, then the lowest a seller will accept is $1,100. If you want to buy their cryptocurrency, you must pay $1,100 for it.
There may be many sellers with the same bid price. For example, if many sellers want to sell their tokens at $1,100, then that is the common bid price. Buyers must pay that amount to purchase tokens from those sellers.
Sellers can also have different bids at the same time. For example, one seller may want to sell their tokens at $1,000 while another wants to sell theirs at $1,020. If you want to purchase from one of these sellers but not the other, then you must pay either $1,000 or $1,020 for the tokens.
Number of sellers
The number of sellers participating in the market determines the total cost to participate in the market. The more sellers there are, the more competition there is, which increases the price you have to pay to enter the market.
If there are only a few sellers, then you will have to pay less to enter the market because there is less competition. The opposite is also true- if there are many sellers, then you will have to pay more to enter the market because there is competition.
How Does This Apply?
Remember that the combined total cost of all participating sellers in any given cryptocurrency market determines the market price. If there are a large number of sellers, then it will cost you more to enter the market as a buyer.
As a seller, if you aggregate all of your cryptocurrency and put it up for sale, then you will receive less than the prevailing market price due to all of the competition.
Seller fees
When you sell cryptocurrency, you will typically pay a small fee to the platform that you are conducting the transaction on. This fee is usually around 0.5% of the total transaction amount.
For example, if you sold $1,000 of cryptocurrency, the seller fee would be $10. Generally, the lower value your transaction is, the smaller the seller fee will be.
Some platforms offer no seller fees, so check out your options before deciding which one to use! Some popular sites that offer seller fees are Coinbase, Binance, and KuCoin.
Selling cryptocurrency can be tricky as there are several things to consider when doing so. One thing to remember is that when you sell cryptocurrency, you are selling it at its market price at that given time.
What are bitcoins?
Bitcoin is a cryptocurrency, or a digital currency. Unlike traditional currencies, cryptocurrencies don’t exist in any physical form. There are no coins, bills, or notes.
Instead, cryptocurrencies use encrypted software applications to manage their circulation and ownership. This process is known as blockchain technology.
Like physical currencies, cryptocurrencies have value. You can exchange them for other currencies such as US dollars or use them to purchase goods and services. However, their value isn’t determined by a government body like the Federal Reserve System or the Eurosystem; it’s determined by the market.
The importance of this fact can’t be overstated: It means that the price of a cryptocurrency like bitcoin is determined solely by supply and demand and what people are willing to pay for it—not by a government body.
Bitcoin supply
The bitcoin supply is fixed at 21 million. No more than that will ever be in circulation, and it will take around 100 years to mine all of them. As more bitcoins are mined, the difficulty to mine new ones increases.
Some sources refer to the total supply of bitcoins as its circulation supply. This is because most people don’t have the computational power or money to obtain all 21 million bitcoins, but instead only have access to a portion of them that are in circulation.
The difference between the total supply and the circulation supply is not very great. It is estimated that there are approximately 17-18 million bitcoins in circulation, with the remaining 3-4 million being held by Satoshi Nakamoto. He has confirmed he is not alive, but that it was his/her early work that has kept the value so high.
How to buy bitcoin
Now that you understand how bitcoin works, it’s time to learn how to buy bitcoin. If you are new to cryptocurrency, you will need to set up a cryptocurrency wallet and identify your account via public cryptocurrency addresses and private keys.
There are a number of different wallets you can use to store your cryptocurrencies in accordance with the type of cryptocurrency you have. Most basic versions only offer a desktop or laptop option, while more advanced ones offer mobile as well.
Once this is set up, then you are ready to buy! You can either find a seller on a exchange or someone willing to sell you directly. If buying from an individual, make sure they are trustworthy by doing some research first.
Bitcoin wallets
Along with cryptocurrency exchanges, bitcoin wallets are the second most popular entity that involves cryptocurrencies. Bitcoin wallets are how users own, store, and exchange their cryptocurrency.
There are several types of wallets, some of which include: hardware wallets, software wallets, paper wallets, and even face to face exchange.
Most cryptocurrency enthusiasts have at least one software wallet and one hardware wallet. Software wallets are accessed through a free download from the internet and allow you to make transactions via an address.
Hardware wallets are devices similar to a USB drive that require you to have confirmation through it before making any transactions. This is very secure because it is not accessed over the internet and only allows confirmed transactions.
There are many reasons people choose different types of cryptocurrency wallets, but the most common reasons are security and cost. Security is very important because if your wallet is hacked, your coins are gone! Cost is important because it can be easy to find a free software wallet, but they may not be as secure.
Coinmarketcap.com
Another website that is very useful is Coinmarketcap.com. This site lists the top 200 cryptocurrencies, their market cap, volume, and price changes over the last 24 hours.
It also has a chart that shows the price change over time of each cryptocurrency. The chart can be set to show 1-day, 1-week, 1-month, 3-month, 6-month, and 1-year price changes.
Using both of these sites will give you a good idea of what cryptocurrencies are worth at any given time. Checking these sites regularly will also help you track the ever-changing cryptocurrency market!
Cryptocurrency Faucets: Free Coins For You!
CoinMarketCap and other sites don’t offer you actual cryptocurrency for free, but there are faucets that do just that! A faucet is a website that gives users a certain amount of cryptocurrency in exchange for doing something simple like completing a short survey or performing a task like watching a video or visiting a certain website.
