The biggest difference about price formation between fiat and crypto funds is that fiat as against crypto is backed up by central governments and local financial institutions. Central banks are in control of its inflation as a part of the money supply. Thus, we have a certain value of fiat formed.
Cryptocurrency value is not determined by institutions, as it has been launched as an answer to centralised money regulations. Through fixed supply, almost non-existent inflation, the price is crucially based upon supply and demand.
Price fluctuation
The value of a cryptocurrency is determined by the capacity and level of activity of its community. If the demand for cryptocurrencies goes beyond the supply, they will gain in value. When a cryptocurrency becomes popular and the amount of transactions denominated in the latter goes up, its price may rise as well. People do not want to sell it because they intend to utilise it, and there is more demand than supply in this instance, causing the value to rise.