The value of a cryptocurrency depends on its community’s size and level of involvement. If the demand for cryptocurrencies exceeds the supply, they will gain value when a cryptocurrency proves useful; if its demand increases, its price could increase too. People do not want to sell it because they intend to use it, and there is a higher level of demand than supply in this case, which increases in value. What determines the value of cryptocurrency Meanwhile, the notable surge in major cryptocurrencies has sparked a significant upturn across the entire crypto market. The global crypto market cap has seen an increase of 0.20%, reaching $1.4 trillion. The market fear and greed index has hit 78, signifying a prevailing “greed” sentiment among investors.

At the heart of how does, cryptocurrency gains value is its business fundamentals, but that is not always the same as its current trading price. Investors assign a particular value to a cryptocurrency because it helps them decide if and when they should buy the token, but there is more than one way to value it.  How to calculate the crypto market cap? Mining is how new units of cryptocurrency are released into the world, generally in exchange for validating transactions. While it’s theoretically possible for the average person to mine cryptocurrency, it’s increasingly difficult in proof-of-work systems, like Bitcoin.