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Crypto Tokens and Coins: What Drives Performance?

The more popular the token, the higher the price, right?

Nicolas Rabener
10 min read
25 Apr 2022

SUMMARY

  • Investors assume that token prices increase with product utilization in the token ecosystem
  • However, the correlation between the token prices and token volumes has been zero
  • Likely explained by token prices substantially being driven by speculation

INTRODUCTION

Much of the crypto world is, by definition, cryptic and difficult to understand. But two crypto trends are crystal clear: Both talent and money are flooding into the digital currency market. Almost every day brings a fresh announcement of software developers from Google or financiers from JPMorgan joining crypto start-ups that are about to revolutionize something.

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