Markets & Sentiment

Market cap explained

Market capitalization

Quick definition: Market cap = coin price × circulating supply. It measures the size of a coin.

Comparing market caps is more meaningful than comparing prices. A coin priced at $0.001 is not necessarily "cheap" if its supply runs into the trillions of coins.

There is also FDV (fully diluted valuation) = price × maximum total supply. A large gap between market cap and FDV means many tokens are still due to be unlocked.

BTC dominance is BTC's share of the total crypto market cap.

💡 Example

Coin A at $1 with 1 billion coins in circulation: market cap of $1 billion. Coin B at $100 with 1 million coins in circulation: market cap of only $100 million.

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Related terms

AltcoinAltcoins are all coins other than Bitcoin, for example ETH, SOL, XRP, DOGE.…LiquidityLiquidity is how easily an asset can be bought or sold without moving the price much.…ATHATH is the highest price an asset has ever reached. ATL (All-Time Low) is the lowest.…StablecoinA stablecoin is a coin pegged to a stable asset, most commonly pegged 1:1 to the US dollar (USDT, USDC).…

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Educational content for reference only, not financial advice. Leveraged trading carries the risk of losing your entire capital.