Many factors influence cryptocurrency prices, but the most important can be divided into 6 main categories:

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🔵 1. Demand and supply

The most basic factor:

The higher the demand (e.g., investors, institutions, adoption), the higher the price.

The greater the supply (e.g., new issuances, sales by large players), the greater the downward pressure.

🔹 Example: Bitcoin has a limited supply (21 million) – this strengthens its value with rising demand.

---$BTC

🟠 2. News and events (newsflow)

The cryptocurrency market is highly reactive to news:

Type of message Example Impact

Positive BTC ETF approved in the USA Price up

Negative Crypto ban in China Price down

Political/geopolitical Trump supports cryptocurrencies, war in Ukraine High volatility

🔹 Example: July 14, 2025 – BTC rose to $123,000 after Trump announced "Crypto Week."

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🟡 3. Regulations and law

When a country allows/accepts cryptocurrencies: price rises (e.g., ETF in the USA, Brazil, El Salvador).

When a country bans or warns (e.g., SEC suing exchanges) – prices may drop sharply.

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🟢 4. Technology and project development

Successful updates (e.g., Ethereum Merge, Bitcoin halving)

New features (staking, L2 layers, scaling)

🔹 Example: Solana gains value thanks to the growing DePIN and memecoin ecosystem.

---$SOL

🔴 5. Moves of institutions and "whales"

Large purchases (e.g., BlackRock, MicroStrategy) → price increase

Large sales → decline, panic

🔹 It's worth tracking 'whale' wallets and on-chain transactions (e.g., through Whale Alert, Lookonchain).

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⚫ 6. Macroeconomics (global finances)

Inflation, interest rates, unemployment

Decisions of central banks (e.g., Fed in the USA)

Correlation with traditional markets (S&P500, gold)

🔹 When interest rates are low → investors seek risky assets → crypto rises

🔹 When the Fed raises rates → declines in the crypto market

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🧭 BONUS: Crowd psychology

FOMO (Fear of Missing Out) → drives bubbles

FUD (Fear, Uncertainty, Doubt) → causes declines and panic selling

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🔍 Summary in brief:

Factor Example Impact

Demand/supply BTC halving 🔺

News / events ETF, war, elections, hacks 🔺🔻

Regulations USA / EU supports or bans 🔺🔻

Technology ETH Merge, Layer 2 🔺

Institutions / whales Purchases/sales 🔺🔻

Global economy Inflation, Fed 🔺🔻

Crowd emotions FOMO, FUD 🔺🔻