Say that you wanted to build your own Bitcoin price ticker from scratch, and not rely on other tickers; how would you go about that?
What variables would come in to play? How would you gauge the price of the coin? Would you add multiple tickers together to get an average, or would it be standalone?
I was always interested in this but could never get my head around how websites do their own price tickers.
There are two possible actors that may build a ticker: exchanges and observers.
Exchanges actually perform trades on their platform so they'll likely be using the last price a trade was performed as the current price.
Observers do not trade themselves and will have to rely on exchanges to get the raw data on trades. They'd then pick the last trade price for each exchange and combine them into a single value. A wide range of schemes is available to merge the values. CoinDesk for example uses an average weighted by an exchanges daily volume.
