The primary reason a person makes an investment in the share market or the cryptocurrency market is to get back returns. The Cryptocurrency works on the basis of capital raised which is done through ICO which in turn is based on the expectation of increase in the price of the currency over time.
One can keep a checking the prices of the crypto coins by following the world coin news. The prices of altcoins are highly unpredictable. They can show a huge fall right after a pump up. Given the existence of such volatile conditions, it becomes imperative for the investor to understand the mechanism of the coins fluctuating prices. Following are the factors which play a major role in the same-
Hype- Just like share market, the altcoin market also works on the basis of hype.
National and international events have and impact on the pricing
The phenomenon of pump and dump is observable in this market as well.
When the prices decline, people buy the tokens(pump) which raises the price which in turn triggers the rise in prices .
When the prices increase, people sell the tokens to earn profit(dump) which can, in turn, trigger reduction in prices.
Pump and dump is a constant phenomenon. None of these phases is permanent.
At the end, it is in the hands of the user to take care of his profitability. He may follow world coin news to keep track of the pump-dump and the new cryptocurrencies finding their way into the market.