Cryptocurrency Market Cap: What You Need to Know
Cryptocurrency market cap is a great way to evaluate the cryptocurrency industry as a whole. It is a metric that tells us how much value there is in all of the digital currencies combined. If you own one type of cryptocurrency, you can use its market cap to determine how valuable it is. It’s also a good way to compare your coin to others in the industry. Knowing this information will help you make smarter investing decisions.
How Cryptocurrency Market Cap is Calculated
To calculate the market cap of a cryptocurrency, you first need to know these three things:
1)The total supply of coins in circulation
2)The price of each coin
3)The circulating supply of coins (the number of coins that have been mined and are currently circulating)
This article is about how the cryptocurrency market cap is calculated.
In order to understand what the cryptocurrency market cap is, let us first try to get a grasp of the term cryptocurrency. It is a digital currency that uses encryption techniques in order to generate units of currency and verify the transfer of funds. The basis for this encryption technique is called cryptography, which was invented during World War II in order to protect important information from being accessed by enemies. Cryptography is also used on internet banking and credit card transactions.
The fact that you are reading this article means that you have probably heard of Bitcoin. Bitcoin was the first decentralized cryptocurrency, which was released as open source software in 2009. All other cryptocurrencies are derived from Bitcoin in one way or another.
A cryptocurrency market capitalization, or “cryptocurrency market cap” for short, is the total value of all coins on the market. Market cap is calculated by multiplying the total number of coins in existence by the coin’s current price. For example, if Coin A has 10 million coins in circulation and each coin is worth $10, Coin A has a market cap of $100 million.
Cryptocurrency market cap or the total value of all cryptocurrencies combined is one of the most searched terms on the internet today. This is mainly because cryptocurrency prices have been skyrocketing in 2017 with Bitcoin being the best performer among them.
As you’re reading this, its market cap has already surpassed $100 billion! But did you know that even if you had just invested $100 in Bitcoin when it was first started, you would have made a whopping $75 million now?
But how does cryptocurrency market cap work? How is it calculated? And what does it mean for investors? Here’s everything you need to know about cryptocurrency market cap and how to calculate it.
To understand cryptocurrency market cap, we first need to understand what a cryptocurrency actually is. In simple terms, a cryptocurrency is a digital asset designed to work as a medium of exchange wherein individual coin ownership records are stored in a ledger existing in a form of computerized database using strong cryptography to secure transaction records, to control the creation of additional coins, and to verify the transfer of coin ownership. Cryptography is used to secure the transactions and to control the creation of new coins.
What Is Market Capitalization?
In simple terms, market capitalization (market cap) is simply the number of shares
The market cap of cryptocurrencies change constantly and is usually displayed in US Dollars (USD).
The market capitalization is calculated by multiplying the price with the supply.
For example, Bitcoin (BTC) has a market capitalization of $126,137,601,265 which means that there are $126,137,601,265 worth of Bitcoins currently in circulation.
The maximum supply of Bitcoin is 21 million coins and as of July 2019 there are 18.2 million coins in circulation.
How to calculate cryptocurrency market cap:
market capitalization = price x circulating supply
The market capitalization of a cryptocurrency is calculated by multiplying the number of coins or tokens in existence by its current price. Here’s an example of how to calculate the market cap of Bitcoin:
Market cap = (Total bitcoins in circulation) x (Price per bitcoin)
= (16,835,600) x ($1,127.90)
In this case, the market cap of Bitcoin is $18 billion.
In this article, we discuss a simple yet effective method for calculating the cryptocurrency market cap. If you have been investing in the crypto space for a while now, you’ve probably heard the term “market cap” used in reference to various cryptocurrencies.
To help better understand what exactly we are discussing here, we will first go over some basic definitions.
Market Cap = Price of Unit x Number of Units in Circulation
The “number of units in circulation” part of this equation refers to the number of tokens currently available to investors on the market. Here is an example:
Let’s say that there is a coin named “ABC Token” with a price of $1 per token. One day, someone creates 1 million ABC Tokens and releases them onto the open market. Therefore, the total market cap of ABC Token should be $1 million (1 million tokens x $1 per token).