The market value of a Crypto

The market value of a cryptocurrency shows at what price the last transaction took place. If a coin has a market value of €200, it means the most recent sale was for that amount. This value is created by supply and demand: the point where buyer and seller meet.

In addition to the price per coin, the total market value—"market cap"—is often used. This is calculated by multiplying the current price per coin by the number of coins in circulation. This gives you an idea of the total value of a cryptocurrency. Bitcoin has been the largest in terms of market cap since its launch in 2009. At the end of 2017, the first major bull run took place: the price rose to nearly $20,000 and the market cap reached $330 billion. In 2019, the price dropped back to $3,300, but in 2021 Bitcoin reached a new record of $69,000.

Cryptocurrencies: a new market

Crypto is known for its strong fluctuations. It's not uncommon for the value of a coin to rise or fall by 5% or more within 24 hours. This makes the crypto market much more volatile than, for example, the forex market. For investors and traders, it's therefore important to keep a close eye on prices.

Where traditional markets like the stock exchange have fixed opening hours, crypto is different: there are no opening or closing prices. The crypto market is open 24/7. You can always enter, buy, or sell anywhere.

Crypto prices and exchanges

Since the advent of Bitcoin and countless altcoins, a vibrant market has emerged. The high volatility makes crypto attractive, but it also carries more risk than traditional markets like stocks or forex. Because crypto is relatively young, prices are less stable than currencies like the euro or dollar, which have much larger market values.

To limit price risk, there are also so-called stablecoins. These are tied to a stable value, usually the US dollar. The largest and best-known stablecoin is Tether (USDT), which is almost always equal to $1.

You buy and sell crypto via exchanges: digital trading platforms where supply and demand meet. Well-known international exchanges include Binance, Coinbase, and Huobi. In the Netherlands, Bitvavo is the officially registered exchange. There, customers can easily purchase crypto via iDeal or credit card. Thanks to these user-friendly platforms, entering the market has become increasingly easier for new investors and traders in recent years. Besides Bitcoin, you can also buy altcoins like Ethereum, Ripple, and Litecoin.