{"id":56,"date":"2022-02-22T16:23:07","date_gmt":"2022-02-22T16:23:07","guid":{"rendered":"https:\/\/www.aurumxchange.com\/?p=56"},"modified":"2022-02-22T16:23:07","modified_gmt":"2022-02-22T16:23:07","slug":"coins-market-capitalization-or-market-cap-what-is-their-role-in-the-cryptocurrency-world","status":"publish","type":"post","link":"https:\/\/www.aurumxchange.com\/blog\/coins-market-capitalization-or-market-cap-what-is-their-role-in-the-cryptocurrency-world\/","title":{"rendered":"Coins Market Capitalization or Market Cap ? What is their role in the Cryptocurrency World"},"content":{"rendered":"<p><iframe width=\"100%\" height=300vh src=\"https:\/\/www.youtube.com\/embed\/ziQwtcNUIaU?autoplay=1&#038;mute=1\"><\/iframe>When someone talks about market capitalization or marketcap in the context of cryptocurrency, they are typically referring to CoinMarketCap. CoinMarketCap is a website that tracks the current price, volume and marketcap of many cryptocurrencies.<\/p>\n<p>What is Market Cap?<\/p>\n<p>Market cap is a way of ranking the relative size of a cryptocurrency. It&#8217;s calculated by multiplying the Price by the Circulating Supply. Market Cap = Price x Circulating Supply.<\/p>\n<p>What is Coins Market Capitalization?<\/p>\n<p>Coinsmarketcap is a website that tracks and displays all relevant data on Cryptocurrencies, including their price and volume as well as circulating supply and marketcap. Many crypto enthusiasts use this website to check on movements in crypto prices and volumes, as well as other metrics that can significantly influence their decision making process.<\/p>\n<p>What is their role in the Crypto World?<\/p>\n<p>Coins Market Cap or Market Capitalization is a term that describes the value of the coins. It is the total of the coins in circulation, multiplied by the price.<\/p>\n<p>Market Capitalization is an important metric that you can use to compare cryptocurrencies and see which one is more valuable or have more potential.<\/p>\n<p>Cryptocurrency Rank &#8211; Coinmarketcap Ranking and Total Market Cap<\/p>\n<p>The cryptocurrency rank or ranking is based on market capitalization, so it is a measure that can be used to compare cryptocurrencies values. If one cryptocurrency has a higher market capitalization than another, this means that its total value is greater. In other words, it means that it can be more valuable or have more potential.<\/p>\n<p>I will try to explain it better with an example:<\/p>\n<p>Let\u2019s say there are two cryptocurrencies: A and B<\/p>\n<p>A has 10 000 000 coins in circulation and its price is $1 each = Total Market Capitalization $10 000 000<\/p>\n<p>B has 5 000 000 coins in circulation and its price is $2 each = Total Market Capitalization $10 000 000<\/p>\n<p>So even if they both have $10 000 000 in total value, B has more potential because its supply is lower.<\/p>\n<p>I thought this would be a good question to answer, because it&#8217;s a very common one.<\/p>\n<p>The market capitalization of a coin is the number of coins in circulation multiplied by the price of each coin. This is used to show how much the market values the coin at.<\/p>\n<p>For example, if there are 10 million coins in circulation and each coin is worth $1, then the market capitalization of that coin is $10 million.<\/p>\n<p>This is also applied to stock markets (where it&#8217;s also called market cap), so it&#8217;s not just cryptocurrency that uses it.<\/p>\n<p>The main reason that I think people use this number to determine a coins strength is because it shows how much liquidity exists for a coin. Basically, if there are more coins out there, then you can trade with those coins more easily than if there were fewer coins in circulation: all other things being equal. This isn&#8217;t always true, but generally speaking it is a good general rule of thumb to use.<\/p>\n<p>While it may have been around for some time now, cryptocurrencies are still a relatively new phenomenon. Despite the innovation and the technology behind them, there are many people who still do not understand what they are or how they work. There is also, of course, the question of whether they will ever be accepted as a mainstream currency.<\/p>\n<p>One of the biggest debates regarding cryptocurrencies and their future is whether or not they will ever become an institutionalized form of payment. For example, will it ever be possible to use Bitcoin to book a hotel room? This is a question that can only be answered with time and more research.<\/p>\n<p>However, there is one thing that most experts agree on. Cryptocurrencies are here to stay! As time goes on, we will see more and more crypto coins being released onto the market. One of the things that make crypto coins so special is their market capitalization, also known as \u201cmarket cap\u201d.<\/p>\n<p>In this article we will look at what exactly market capitalization means in terms of cryptocurrency and why it is important. We will also look at how you can calculate market cap for yourself and what you can do with this information once you have it.<\/p>\n<p>The term Market Cap is widely used in the cryptocurrency world. One can find the total capitalization in the beginning of every cryptocurrency page! It is also present on all website that are related to cryptocurrencies. For example, one can find it on sites such as CoinMarketCap, LiveCoinWatch, CryptoCompare, etc.<\/p>\n<p>So what does Market Cap mean for a Cryptocurrency? It is calculated by multiplying the total supply of coins by the price of a single coin:<\/p>\n<p>Market Cap = Total Number of Coins x Singular Price<\/p>\n<p>So let&#8217;s say you want to know the Market Cap of Bitcoin. You would take the total number of Bitcoins that are circulating in the market and multiply it by its current price. (We will use figures from March 2018). With over 16.7 million Bitcoins in circulation and with a price of $9,000; we get a total cap of $150 billion dollars.<\/p>\n<p>In other words, if someone wanted to buy all of Bitcoin at its current price; they would have to spend $150 billion dollars!<\/p>\n<p>What is the difference between the Market Cap and the Coin&#8217;s Capitalization?<\/p>\n<p>The simple answer is that they are two different things.<\/p>\n<p>The market capitalization of a coin can be defined as the total value of that particular coin\/token. This is done by multiplying the total circulating supply with its price. For example, Bitcoin has a circulating supply of 18,000,000 BTC and its current price is around $6,000.00 USD which means that Bitcoin&#8217;s market cap is $108,000,000,000 USD or 108 billion USD. <\/p>\n<p>In contrast to market capitalization, coins or tokens&#8217; capitalization refers to the total amount of money raised through crowdfunding or an ICO (Initial Coin Offering). A good example for this is EOS which has a circulating supply of 900 million EOS tokens but raised around $4 billion during their ICO phase which makes it one of the most successful ICOs ever.<\/p>\n<p>The term &#8220;market capitalization&#8221; refers to the entire dollar market price of a company or stock. It is computed by multiplying the total number of outstanding shares by the present share price.<\/p>\n<p>What is Market Capitalization in Cryptocurrencies?<\/p>\n<p>Cryptocurrency market cap tells us about cryptocurrency&#8217;s value, how much it costs, and how often it is traded on exchanges (hence the liquidity). If Bitcoin&#8217;s market cap hit 1 trillion dollars, that would mean that 1 BTC = 50,000 USD. But we all know this will never happen (i hope so) as there are only 21 million BTCs mined. Even then, at $50k per coin, there would be a lot more money in Bitcoin than any other currency in the world.<\/p>\n<p>Why does Market Cap matter?<\/p>\n<p>Cryptocurrency market cap matters because it is a better indicator of cryptocurrency value than price. The price of a cryptocurrency can be artificially inflated through buying and selling but its market cap will always remain honest. This is because when you inflate the price without adding any new coins to circulation, your market cap remains unchanged.<\/p>\n<p>If you want to know what the actual value of a cryptocurrency is, look at its market cap instead of its price. The higher the market cap, the more<iframe width=\"100%\"\" height=300vh src=\"https:\/\/www.youtube.com\/embed\/bM2Hyocsbik?autoplay=1&#038;mute=1\"><\/iframe><\/p>\n","protected":false},"excerpt":{"rendered":"<p>When someone talks about market capitalization or marketcap in the context of cryptocurrency, they are typically referring to CoinMarketCap. CoinMarketCap is a website that tracks the current price, volume and marketcap of many cryptocurrencies. What is Market Cap? Market cap is a way of ranking the relative size of a cryptocurrency. It&#8217;s calculated by multiplying [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/posts\/56"}],"collection":[{"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/comments?post=56"}],"version-history":[{"count":1,"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/posts\/56\/revisions"}],"predecessor-version":[{"id":57,"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/posts\/56\/revisions\/57"}],"wp:attachment":[{"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/media?parent=56"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/categories?post=56"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.aurumxchange.com\/wp-json\/wp\/v2\/tags?post=56"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}