Market Cap

A Market Cap is the total estimated value of a cryptocurrency's circulating supply at its current market price. It provides a snapshot of the asset's size in the market. Also called market capitalization or mcap, it helps investors compare crypto projects.

Calculate market cap by multiplying the current price per coin by the circulating supply. Use this formula: Market Cap = Current Price × Circulating Supply. Circulating supply counts only tokens available for trading, not those locked or reserved. For example, if Ethereum trades at $3,000 with 120 million ETH circulating, its market cap reaches $360 billion.

Market cap matters because it ranks cryptocurrencies by size and indicates liquidity and stability. Large-cap assets like Bitcoin resist manipulation better due to high trading volume and broad adoption. Small-cap coins offer growth potential but higher volatility and risk. It guides portfolio allocation and reveals market sentiment.

Key types include fully diluted market cap, which uses total supply instead of circulating supply to predict future value. Categories classify assets: large-cap (over $10 billion), mid-cap ($1-10 billion), and small-cap (under $1 billion). Always pair market cap with trading volume and tokenomics for full context.