Bases of cryptocurrencies: necessary indicators of the evaluation of cryptographic assets
In recent years, the cryptocurrency world has recorded rapid growth and variability, and some assets have increased explosive price increases, while others have fallen. Consequently, investors and analysts must carefully assess the fundamental aspects of the assets of cryptocurrencies before investing.
In this article, we will immerse ourselves in key indicators that fund managers use to assess cryptocurrencies and ensure their importance when determining the value of cryptocurrency.
1. Market capitalization
The market capitalization (market capitalization) is a widely recognized indicator which represents the total value of suffering shares or cryptocurrency assets. It can be calculated using the model: the stock market capital = the total offer / 2. This file indicates the size of the market size, then the quantity of liquidity.
The market capitalization is necessary to determine the overall value of cryptocurrencies, because it affects the amount of turnover, the interest of investors and the moods of the market. For example, if cryptocurrency has a high stock market capital, investors will be more likely to be interested in buying or selling assets, which can increase prices.
2. Offer and request
The supply and demand are key factors affecting the price of cryptocurrencies. The balance between buyers and sellers is crucial to determine whether the price of assets will increase or drop.
There are two main types of supply and demand:
* The request made by the seller : it is at this time that investors are happy to buy cryptocurrency at a low time, increasing prices.
* The buyer’s buyer’s buyer : Conversely, if there are fewer buyers than sellers, prices tend to decrease.
Fund managers use indicators such as the granting volume (TVL) of scholarships, the capitalization of the parts market and the price price indicator (P / E) to assess supply and demand. High TVL underlines the community of growing investors, while low TVL may indicate a decrease in interest in activation.
3. Turnover volume
The amount of turnover is another necessary indicator which measures the amount of purchase and sale on the stock market. It gives an overview of the moods of the market, liquidity and price stability.
The high volume of rotation may indicate a high demand for cryptocurrency, which can increase prices. And vice versa, a low volume of rotation can suggest a lack of interest in activist or increased variability.
4. Capitalization of the VS. provide
The fundamental aspect to be considered during the assessment of cryptocurrencies is their supply and demand ratio (SMDR). This record measures the difference between the capitalization of the asset market and its total supply.
If SMDR is high, this may indicate that there are more buyers than sellers, which can cause prices over time.
5. Price ratio for profit (p / e)
The P / E indicator compares the price of cryptocurrency actions to take advantage of the action. This dossier helps investors understand if the resource is undervalued or overestimated in relation to its peers and industry reference points.
A higher P / E indicator may indicate that the active component is the subject of the bonus, while the lower indicator suggests that it is honestly appreciated.
6. Volatility
Variability refers to the fluctuations in cryptocurrency prices in a short time. High volatility can be beneficial for investors looking for a high investment return.
Fund managers use indicators such as the standard deviation (SD) of the daily negotiation volume or the average time between price fluctuations to assess the variability of assets.
7. Technical indicators
Technical indicators give an overview of basic trends and cryptocurrency models. They can be used in combination with a fundamental analysis to make informed investment decisions.
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