It’s similar in cryptocurrency, except cryptos don’t represent equity in a company like stocks. The market cap of a coin is simply what you’d get if you added up every available coin at the current price per coin. Imagine if you cashed out every Bitcoin in existence at the exact same time. That’s the market cap.
Why did the market cap of cryptocurrencies increase in 2023?
It is estimated that the cumulative market cap of cryptocurrencies increased in early 2023 after the downfall in November 2022 due to FTX. That value declined in the summer of 2023, however, as international uncertainty grew over a potential recession. Bitcoin's market cap made up the majority of the overall market capitalization.
How do you calculate market capitalization in cryptocurrencies?
It is found by multiplying the number of shares outstanding by the price per share. It’s use as a measure of overall value is now being applied to bonds, commodities, and cryptocurrencies using the same formula. What Does Market Capitalization Mean in Crypto? What Cryptocurrency has the Biggest Market Cap?
What is the difference between mid-cap and small-cap cryptocurrencies?
Mid-cap cryptocurrencies have market caps between $1 billion and $10 billion – they generally are considered to have more untapped potential upside but also higher risk. Small-cap cryptocurrencies have a market cap of less than $1 billion and are most susceptible to dramatic swings based on market sentiment.
