Being able to determine the estimated value of a cryptocurrency will enable you to make a wise decision when it comes to choosing the right coin for investment. But, it’s easier said than done.
Unlike traditional currencies, the value of cryptocurrency is not fixed or determined by centralized entities such as the government or banks. Instead, cryptocurrency price depends on the market sentiment. The higher the demand, the more will be the value of a particular coin.
So, how exactly do you assess the demand or market potential of a cryptocurrency? Well, we use the concept of predictive logic, where we try to figure out the estimated value of a coin in terms of factors like market potential, goals, team, growth potential, etc.
Determining the value of a cryptocurrency
When you are trying to figure out the value of something like a cryptocurrency that is not governed by traditional rules & regulations, the best you can do is assess the underlying factors such as the market potential and growth potential.
For this article, we will take the example of the Libra Coin, which is one of the fastest growing cryptocurrencies today. Let’s try to determine its value based on:
A cryptocurrency with a huge market demand will always have a good potential value. In order to determine the market demand or potential of a coin, one must look into the project that it backs. Does the crypto project have any real market demand? Does it solve a real problem? How does it help potential users? What is the future scope?
For example, the Libra Coin is a cryptocurrency backed digital payment system created for e-commerce businesses and consumers. As a global, peer-to-peer payment system, Libra can be used by e-commerce operators worldwide. Both the market potential and demand for the coin/system is expected to be huge in the coming days.
Another factor to affect the price of a cryptocurrency is its purpose and long-term goals. A coin with a real, significant purpose will naturally have a good future value compared to a coin created with the purpose to only make quick money. In short, the coin and the project should be of value to the end-user.
Libra Coin, for instance, delivers huge value and has a purpose of making e-commerce easier and more productive for everyone. It has the potential to disrupt the online shopping & payments industry through decentralized innovation.
No matter how strong a project or idea is, it cannot be successful unless it’s backed by execution, which takes a powerful team of really passionate blockchain enthusiasts.
For example, the Libra Coin and the system were created by a team of blockchain developers, creators and investors who wanted to create a solution to the online investors’ problem through a system that is transparent, just and affordable.
Whether or not a cryptocurrency will have a good future value will depend on things like how strong the project concept or idea is, whether the team behind the project is capable enough to make it a success and how much trust or support investors have in the project.
In the end, it’s not possible to accurately predict the future value or success of a cryptocurrency. The best you can do is research and explore more about the underlying project and the team and invest in a project that seems eager to solve a real-world problem.
Find out more about the Libra Ecosystem and the coin at https://libraecosystem.com/