The Concept Of Demand And Supply In The Cryptomarket #003

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Hello crypto friends,

With a humble heart i happily come before you all today to discuss an issue of great importance in the cryptospace.

I believe you are all doing great and are enjoying your activities in the community.

Today, we shall continue our discussion on the concept of demand and supply and we shall be learning a lot today.

In our last discussion, we learnt on the foundation of demand in cryptocurrency and today we want to discuss on the factors affecting demand I'm cryptocurrency.

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FACTORS AFFECTING DEMAND OF CRYPTOCURRENCY

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There are so many factors affecting demand of cryptocurrency in the market, while instrinsic factors play a great role in laying the ground work for demand, some other external factors also play a part in shaping the flow of demand within the cryptomarket.

Explained below are some factors affecting demand of cryptocurrency in the market.

• MARKET SENTIMENT AND SPECULATION:

Market sentiment often driven by social media, news, public perception can have a great impact in demand of cryptocurrency in the market.

Positive sentiment that is consists of news of adoption by major institutions, tends to attract investors into the market.

However, when there is a negative news about a certain cryptocurrency in the market, it scares away investors and everyone seeks to sell off their holdings, inorder not to result in loss of their investment

In doing so, they are reducing the demand of such cryptocurrency in the market, thus reducing it's value.

• REGULATORY ENVIRONMENT:

Another Important factor influencing demand of cryptocurrency is it's regulatory environment.

A favorable and clarity landscape can have a positive influence on a cryptocurrency by instilling confidence and trust in potential investors, and it also attracts potential investors into the cryptocurrency.

When a regulatory environment is unfavourable, it instill fear and doubts on the minds of investors and this pursues them away from a crypto currency project.

• MACROECONOMICS FACTORS:

In our world today, cryptocurrency has increasingly become mixed with our traditional financial institution.

Economic Indicator such as interest rates, inflation rates, geopolitical events oftentimes have a great impact on the demand of cryptocurrency in the financial market.

During economic uncertainties, investors often search for safe places to invest their funds so as to prevent it from loosing value.

And this inturn has a great impact on the demand of cryptocurrency in the market.

• SIGNIFICANT PROJECT EVENT:

Another factor that affects the demand of a cryptocurrency in the market are significant events associated with such cryptocurrency.

For example, the demand of bitcoin is often very high during the bull run and often in times associated with its halving.

The halving events of bitcoin often has a significant impact on the demand of cryptocurrency in the market.

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CONCLUSION

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Demand and supply in the cryptomarket as it helps in the general operation of the market.

It helps to affect the price of the cryptomarket and making it nice for newbies