# Applying Artificial Intelligence in Cryptocurrency Markets: A Survey
## 2 Cryptocurrency Markets
### Price Determinants of Cryptocurrencies  
The growing importance of cryptocurrency markets in changing the worldwide economy is not negligible. It is necessary to understand the underlying features of financial aspects of cryptocurrencies before taking further action in devising an ML model with high prediction capability in forecasting their behaviours. Moreover, there are motives for both governmental bodies and individual investors to expand their knowledge about the factors behind the price formation of cryptocurrencies. For instance, cryptocurrency markets can be a potential source of instability in economic systems. Consequently, they may influence policymakers' decisions and limit the authority of governments all over the world. Moreover, an investor's asset portfolio allocation and risk management strategy can be influenced by fluctuations in cryptocurrencies [2]. To manage the consequences, the econometrics of cryptocurrencies seek interdisciplinary research to explain how traders' actions inform price discovery [33]. For the purpose of interdisciplinary research, the Cross-Industry Standard Process for Data Mining is considered a framework for analysing the problem of price prediction. It is one of the most common methodologies used to describe data science projects (Figure 3) [34]. CRISP-DM is a process model that naturally describes the data science life cycle and contains six phases. First, the business understanding phase is about the objectives and requirements of a particular project. Next, the data understanding phase focuses on identifying, collecting, and analysing datasets to achieve the project goals. Then, the data preparation phase processes the final dataset to be used in the modelling phase, which builds and assesses several models to find the best model(s). Finally, the evaluation and deployment phases are self-descriptive, which are about evaluating results and deploying the model into action. A significant observation and motivation behind incor \begin{table}
\begin{tabular}{l c c c c} \hline \hline
**Exchange** & **No. Supported Coins** & **Transaction Fee (\%)** & **Headquarter Location** & **Founded** \\ \hline Binance & 320+ & 0.100 & Malta & 2017 \\ \hline Coinbase & 40+ & 0.500 & San Francisco, US & 2012 \\ \hline BitMex & 160+ & 0.075 & Eden Island, Seychelles & 2014 \\ \hline Okex & 230 & 0.150 & Malta & 2017 \\ \hline Huobi & 310+ & 0.200 & Seychelles & 2013 \\ \hline Bitfinex & 30+ & 0.200 & Hong Hong & 2012 \\ \hline Kraken & 60 & 0.260 & San Fransisco, US & 2011 \\ \hline Bitterx & 320+ & 0.350 & Seattle, US & 2014 \\ \hline BitStamp & 10+ & 0.500 & Luxembourg & 2011 \\ \hline KuCoin & 270+ & 0.100 & Mahe, Seychelles & 2017 \\ \hline \hline \end{tabular}
\end{table} 
Table 3: Information about a number of most known cryptocurrency exchanges. porating CRISP-DM are that the study of current literature in the cross-disciplinary field of AI and cryptocurrencies demonstrates that AI community researchers mainly focus on the modelling phase of CRISP-DM, and the business understanding phase is mainly neglected. Thus, this section provides information to understand the factors behind the price formation in cryptocurrency markets by focusing on business, finance, and economic perspectives by means of CRISP-DM. Factors that drive the price of cryptocurrencies can be divided into internal factors and external drivers, including macro-financial and attractiveness for investors [35]. The internal factors are about the generation of the data blocks via the mining process in a blockchain network, and they directly impact the supply and demand of each cryptocurrency [36]. Furthermore, similar to a fiat currency, which is valued based on the trust in which it will be accepted as an exchange medium, cryptocurrencies establish their trustworthiness among market participants by creating trust and credibility [1]. In other words, the attractiveness of cryptocurrencies for investors is considered an external factor driving price fluctuations.