Market capitalization, sometimes known as “market cap,” is a metric used to express the total worth of all of the coins in circulation. You would multiply the total number of units in circulation by the current price per unit to get a cryptocurrency’s market capitalization. This tells you how much the entire supply of that coin is worth.
The total number of units in circulation is frequently referred to as the “circulating supply” in the context of cryptocurrencies, while the current price per unit is frequently referred to as the “current price.” A cryptocurrency’s market cap can be used to determine how big and valuable it is in relation to other cryptocurrencies.
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It’s critical to understand that a company’s or project’s market cap is not the same as its overall value. It merely serves as a gauge for the worth of digital assets that are now in use.
The prevailing consensus is that a cryptocurrency with a larger market cap is both more valuable and more established. Market capitalization shouldn’t, however, be the sole metric used to assess a cryptocurrency because it ignores aspects like the general soundness of the technology underlying it, the caliber of the development team, and its potential for future growth.