In crypto, there are two prices that you should be familiar with: mark price and last price. Both of these have very different meanings and use cases, so it’s important to know the difference between them and when to use one over the other.
In this article we’ll take a look at each one individually, as well as how they differ in terms of trading strategies.
Prices in Cryptocurrency
Price is of utmost importance in cryptocurrency. Price is the first thing that catches people’s eyes when they look at the cryptocurrency market. This is because investors want to know how much a coin will be worth and when they can expect to make their money back after investing in a coin. They also want to know if the value of the coin will keep rising or if it will reach rock bottom, so that they know exactly when to sell their coins.
Cryptocurrency prices, including LUNA price are very volatile, and there is no way to predict when the value will go up or down. Everything is based on what the market demands. The market might value one coin more than another one today, but tomorrow, it could be flipped around.
Price plays a very important role in cryptocurrency because it makes people interested and willing to invest in different cryptocurrencies.
What does the Mark price in crypto mean?
Mark price refers to the current market value of a product or service. You might see this word in financial or manufacturing industries, where prices are often listed in both current dollars and their original or previous amount. It’s also a useful tool when comparing prices across different time periods, since you can use it to make sure that you’re not overpaying for something from yesterday’s sale price.
From a crypto perspective, the mark price is especially important because crypto is all about market value—it fluctuates as much as the stock market does, but without the same sort of safety net. If you’re selling some crypto at an exorbitant rate and the market crashes soon after, your investment may be in trouble.
So it’s important to know how much your crypto is worth at any given moment. That’s where mark price comes into play—it tells you what people are currently willing to pay for your coins.
What is the last price in crypto?
Last price is a term that refers to the lowest price at which a cryptocurrency exchange has sold an asset for. In other words, the last price shows the lowest amount of money you can buy one unit of a given cryptocurrency for.
The last price of a coin is the most recent price in the market, while the mark price is based on your previous buying or selling of a coin. When you buy a coin at the last price, you’re not getting a deal because you’re paying more than the market rate. You can use mark price instead and save yourself some money.
Last price is the most common type of order in the cryptocurrency trading pairs such as BTC USDT. It is when someone asks to trade their current holdings for another cryptocurrency. If someone wants to trade their Bitcoin for Litecoin, they would set a last price order.
Pros and Cons – Using the ‘Last Price’ for trigger price in crypto
Let’s see the pros and cons of using the ‘Last Price’ for trigger price in crypto trading.
Pros:
- If you choose to use the last price to determine when to buy or sell, you can get a better sense of how the market is behaving.
- This method also allows you to avoid paying a lot of fees that would be due if your order was triggered by a limit order. Since there are no limit orders in crypto, this is less important than it is in traditional markets.
- The only thing that could happen if you use this method is that the last price might change before your order is executed (for both buying and selling).
Cons:
- It may take longer before you get an order filled because of fluctuating prices.
- The major drawback of this strategy is that you might miss out on some good buying opportunities because you’re waiting for the last price.
Pros and Cons – Using ‘Mark Price’ for trigger price in crypto
Pros
- It is a way to set a threshold for your own investment decision, if a particular coin goes above that threshold it will be a signal to reduce your risk by selling some or all of your coins.
- It helps to define the range of actions that will occur if the investment goes in the opposite direction, enabling you to make better decisions about what action should be taken.
- It helps to avoid making emotional decisions as it anchors your thinking around a pre-determined level of price, which can help prevent buying at the top or selling at the bottom.
- It helps to provide discipline and consistency, because if you have decided on an exit strategy and a trigger price then it is easier to stick with that plan even when things are going against you.
Cons
- You may have to input different thresholds for different coins, as each one has its own volatility and market value.
Factors to Consider Whether to Use Mark Price to Last Price
There are a few things to consider when you’re deciding whether to use Mark Price or Last Price.
First, you have to decide what the purpose of your order is: if you want to sell high, use Last Price; if you want to sell low, use Mark Price. If you want to buy high and sell low, set both.
The second thing to consider is the volatility of the market; in more volatile markets, it’s better to use Mark Price as it will be quicker—in lower-volatility markets, Last Price will be quicker as it’s more likely that the price will move into your profit range before your order executes.
Last price is best for getting in and out of trades quickly (though it may be better suited for manual trading than for automated trading). If you want to get in and out of a trade quickly, but you don’t need to take advantage of changes in price, consider using the last price.
Which is Better? Mark Price or Last Price?
Between Last Price vs Mark Price, it’s hard to determine which of these is better. The last price is more useful for trading, especially for day traders. With the last price, you can instantly gauge how much money you lost or gained from your previous transaction, and you can set your next trade at a specific percentage of that loss or gain.
Say your last trade was at $100 and the current price is $90, then the next trade would be 10% lower to make up for that loss. The mark price is better if you want to see where the market is going or if you’re a long term holder.
So if you’re looking at the mark price, then the amount of bitcoin is what matters, not how much cash it got converted into. This can be useful for people who are more interested in the crypto investment than cash value.
