Which coin has the largest market cap? Hint: It might not be the one you think...

in crypto •  7 years ago  (edited)

On first thought, everyone will most likely say: "Bitcoin, obviously!"

However, what if I told you that might not "technically" be the truth?

By the way, it's not technically a market cap, but more like a total network value, but I will use the term "market cap" since it is what I am most used to from dealing with traditional equities.

If you don't like that, tough luck! :)

What the heck am I talking about?

Let's dive into some numbers...

Bitcoin currently has about 16.8 million coins in circulation with a price of roughly $17k per coin, which equates to roughly $285.6 billion.

Further, Bitcoin will technically only ever have 21 million coins in circulation.

There is debate about whether the forked coins add supply or not, but that is a debate for another day.

The original Bitcoin is worth roughly $285.6 billion at its current price.

According to coinmarketcap, that is far and away the largest market cap in crypto land. With Ripple coming in second place at less than half the value, right around $119 billion.

(Source: https://coinmarketcap.com/ )

Yes, if you haven't been paying attention this past week, Ripple leaped Ethereum as the second most valuable cryptocurrency in existence.

Pretty crazy right?

Here is where things get interesting...

What if I told you that "technically" Bitcoin wasn't technically the most valuable cryptocurrency in existence?

What if I told you that technically Ripple is more valuable than Bitcoin right now? Even with Bitcoin at $17k per coin.

And I am not talking about potential value or anything like that, I am talking straight dollars and cents.

You see, Ripple is quite different than bitcoin in how it works.

With Bitcoin, coins are mined on a blockchain with a maximum number to ever be produced set to be 21 million. Those 21 million coins don't technically exist yet, which is why determining market value based on current circulating coins makes sense.

However, with Ripple, the 100 billion coins are not mined or through some other act of securing a decentralized network.

Instead those coins are already created, and most are controlled by Ripple.

So, (technically) the 100 billion coins that will ever exist, already do. Even if roughly 61 billion of those are held by Ripple itself.

Which means, technically, a more accurate description of the total network value of Ripple would be the current price multiplied by 100 billion.

Which would be $3.06 X 100 billion = $306 billion network value.

(Source: https://coinmarketcap.com/currencies/ripple/ )

Which would be about $21 billion MORE than bitcoin. Technically.

One slight caveat to all this...

One thing to keep in mind is that Ripple recently announced that they would be locking up roughly 55 billion Ripple in an escrow account, which would be released at a rate of 1 billion coins per month for the next 4 and half years.

So, technically those coins are locked up.... but still.

Technically, Ripple has the largest market cap of any coin currently.

Technically. ;)

*This was meant to be a fun ironic post, not to be used for making any investment decisions.

Stay informed my friends.

Sources:

https://www.coindesk.com/100-billion-controversy-xrps-surge-raises-hard-questions-ripple/

Image Sources:

https://wels.net/the-ripple-effect-lydia/

Follow me: @jrcornel

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hummm ! @jrcornel , I was in a debate about bitcoin that it has (You call it market cap) is most network value in the world crypto. Thanks for the information otherwise I was about to slap him or at least I was taking swear on God. #tough lock for me Ha Ha ha ha #God bless you.

Ripple is nothing but a P&D done by big hedge funds and their banker buddies. Pure and simple. Anyone looking to invest in Ripple should research the long list of lawsuits and links between Jed McCaleb, Ripple and Stellar: https://www.coindesk.com/?s=ripple+lawsuit

Ripple is not a REAL cryptocurrency, it's a for-profit company masquerading as a cryptocurrency.

Agree 100%.
I hate Ripple with a passion!

Do you recommend investing in Ripple now?

Probably best to consult a financial advisor for that kind of question. :)

I'm staying away from it, and hoping it fails. I don't like the concept, and there's plenty of good coins to choose from that value people's liberty.

  ·  7 years ago (edited)

ripple (no Caps), central banking? No thanks. Buying into ripple makes about as much sense as fighting fire with oil.

I sold mine for #Paccoin

I dont think it will be profitable since it has so low price now.

lol

What...

i recommend to invest in Litecoin because is going up.

Right now am investing in lower price currencies, its easier to 2x, 3x or even 5x your investment

this can be a good ideea.

Can you tell me in what you are investing?Sorry for asking,but i am in the beginning with all this (steemit,bitcoin,litecoin)and any information can help me move on.

i m proud

I think its to late ... EOS will be better at this moment

Check out my last post.

All depends what your investing with I don't think swapping some bitcoin for ripple is such a bad idea as it's very good for sending instant transactions with low fees.

This is why market cap means nothing in the crypto world, the only thing that gives a coin its value is supply and demand on the exchanges.

yes supply and demand. i would say 90% people who involve in cryptocurrency will know and used coinmarketcap. look at youtubers, and so on.

  ·  7 years ago (edited)

Supply/Demand - certainly. But market cap doesn’t mean nothing. We’ll see volatility calm as market cap continues to rise, that’s something.

Thanks for the interesting post. Ripple wants to control its price by releasing coins regularly so the usage will grow steadily and also have a greater utility for banks. Bitcoin is on a different level with its limited supply and yet the ability to airdrop valuable forks along the way. It is ironic that a centralized crypto company has created such a valuable product that for the moment on paper can be valued higher... than BTC. I'm sure this comforts the Federal Reserve... that they still may have a chance!

Yes, that appears to be what they are doing. The net effect is very similar to what btc and other coins are doing via mining, but "technically" it is slightly different. Thanks for the reply. :)

That's true, although it doesn't seem like they are in too much of a hurry to actually use it.

No they aren't because they love controlling their monopoly money with swifts!

I agree that you have to rate Ripple with the 100 billion coins. But I'm not a friend of Ripple at all. For me it's a bankster coin. Surely you can make money with the coin, but if you are more interested in the decentralized aspect of cryptocurrencies, you should not buy and support ripple.

Ripple is crazy giant...
Somehow we wanted decentralized world, and got all the many in hands of few persons that can now manipulate and destroy all the market :(

interesting

Ripple is such a Rippoff! The supply is controlled by the world's experts in market manipulation, the banks! Hello! Can't you see this is just a scam to hijack our BTC??? Boycott Ripple!

Whoa, this is super interesting! Thanks for sharing!

One of the Christmas parties we went to I stumbled across a gentleman talking up Ripple to three others who knew nothing about the wonderful world of digital currency. He was very insistent that Ripple was a "must have" investment because of it's centralization. He said our banking system has no interest in a decentralized autonomous product.
While this was not really new news to me, what I found interesting was that he works for Citigroup. Secondly, after he finished his pitch on Ripple I engaged him of course and found him to be very schooled on Ripple, way beyond myself but he had no cryptocurrency knowledge at all outside of Ripple and of course Bitcoin.
He pulled up the price of Ripple on his phone app. and said "this thing is going to be over $1.00 by New Years. The party was December 9, 2017.
https://coinmarketcap.com/currencies/ripple/historical-data/

Yes - there is a lot of gray area in the space with valuations. The amount of available coins is definitely an area of confusion. The lesson from Ripple is that it is going to be hard to move from the traditional thought process. People like semi-centralized. Interested to see how this project develops.

This is incorrect, sorry dude! If all 100b XRP was available right now, the price would plummet as supply would be drastically increased. Even as they release 1b XRP per month, you can expect the price to decline unless exuberance is so insane that it outpaces the increased supply.

They're literally acting like The Fed in this scenario, except in this situation there's a cap to how much they can release ;)

~ Kevin

It was never stated that they all were available right now, in fact it says just the opposite in the very last paragraph.

Well said dude, ripple is the most centralised coin in the cryptosphere, banks will handle it as they want and one tool is by putting less or more supply at the market, controlling the scarcity of a coin is a way to control its price.

Agree. Add to that the fact that banks do not have to use XRP and you have a completely different picture to the investing puzzle. Ripple the company? Could take off. XRP? I wouldn't bet on it personally.

"[banks] controlling scarcity" not different to a whale controlling it...don't be biased. Also, Ripple have said many times, YES the banks do not have to use it, BUT why wouldn't they if it saves them money and has a crap ton of liquidity?

We'll see. It's a HUGE IF.

? its been confirmed today. I touched on it here if you want to find out more: https://steemit.com/ripple/@guidescrypto/05-01-18-crypto-recap

Its not banks but close enough right?

Personally, I use RIPPLE for pure trading, I am not hodling but getting more an more profits, for me is just a powerfull tool nowadays just get money...
by the other side, I am sad to see that many people believe on it....

it would only plummet if they put them on the market...if they aren't locked up but aren't on market the price wouldn't change

Right, but then claiming that "technically" it's the highest value crypto is false, because you're applying current market price to total supply, not circulating supply.

agreed, its an evaluation of the total worth that doesn't apply when selling

Right. For example, Stellar is worth $0.72c right now. Circulating supply is 17.9b. Total supply is 103.5b. So should we say its true valuation is $74b (0.72*103.5b)? Definitely not. Same goes for Ripple / any other coin.

The point was that the coins technically already exist. The coins yet to be mined don't "technically" exist yet. It was all based on technicalities, not to be taken literal, which you seem to be missing.

Right, but I could make the same argument for the diamond industry. X diamonds are cut and available for sale in stores, X+Y diamonds are cut total (there are MANY multiples more diamonds mined + cut than available for sale).

Say average price of a diamond is $500 for the example's sake.

There are 1 million diamonds available for sale, so circulating supply market cap is $500m. But there are 10m more diamonds already mined, but held in a vault. It would be silly to say that the market cap for diamonds is now $500 * 11 million (1 million circulating + 10m yet to be released, but existing).

Because if they were released, even in chunks that would depress the market price and the calculation would be completely different.

So the only universe in which XRP is the largest market cap coin is one in which they release 100% of existing coins and demand keeps price perfectly stable, which is more or less an impossibility from an economic standpoint.

Yes you could make that same argument. The post had nothing to do with whether or not those extra 61 billion coins could come into the market or what those might do to the price. In fact, it states right in there in the post that they are restricted and only slowly being added to the market much the same way new bitcoins are mined. However, the process is very different. Which was more or less the point, hence all the "technicalities".

If all 100b XRP was available right now, the price would be whatever it's going to be due to supply AND demand.

Correct, which is what I meant when I said "...you can expect the price to decline unless exuberance is so insane that it outpaces the increased supply."

Yeah, I read what you posted. You basically wrote "this post is incorrect unless it isn't." You disproved nothing @jrcornel wrote.

I mean, if that's how you want to interpret it. His entire post is assuming that if 100% of supply was circulated today, that price would remain the same thus price x total supply = market cap = "technically" bigger than Bitcoin. If you can't see the logical flaw in that type of reasoning...dunno what to tell you.

If 100% of the supply was circulated today at the same price, it would be a larger market cap. It's not hard to get this. I think a) you don't believe that demand would allow for the price he imagines, and b) you're just looking for something to disagree with.

Of course I don't think demand would keep up with a 60 billion coin increase in supply...that would be an unnecessary and stupid assumption. See the diamond point I made above, same logic. No one would ever speak like this in a market outside of crypto.

This is all hypotheticals. The fact that you're getting so worked up about this is hilarious.

Just because they exist, doesn't mean they are in circulation... They are being held by the company and their CEO has repeatedly said that it would be incredibly stupid and self-destructive to release all of them or close to that and diluting the price for those who own it (which couldn't happen if they were all in circulation). Some of them are even in special funds that are completely locked for "x" amount of months to give investors more confidence in the fact that it won't get diluted. Which again could not happen if every coin was in circulation and available for trading.

Ripple in interesting, but not interesting enough for my money. The centralized nature of the currency, and the track record of those who control it is off-putting. Seems like the opposite of decentralized currency.

God bless you.

thanks.. always good and informative post u give..
a kind of very friend to friend talk when i read it.
i’m beg hodler ripple to early 2017..

i’m resteem your post for my revision. thanks

As long as we have from the top 20 some alts, and a lot of STEEM, we always benefit!

I hope the large supply of ripple that the team members have doesn't screw the investors over...Nice post!

The Ripple/Bitcoin drama is an exciting one to watch play out in real time. I do think we'll see a couple of other cryptocurrencies surpass Bitcoin's market cap in the next couple of years. That Ripple could already be more valuable than Bitcoin is definitely an interesting proposition.

Thanks for the post, @jrcornel.

Anyone with crypto stored on an exchange would be advised to get at least most of their crypto onto a good wallet!

https://steemit.com/cryptocurrency/@nzfxtrader/top-5-best-cryptocurrency-wallets

Any Steemians here recommend a certain wallet for the best storage of crypto's ??

The top 5 alts have been underperforming compared to my trading fund...just posted this weeks results:

Benkalashnikov Trading Fund Is +22% This Week (Beating Bitcoin)

https://steemit.com/bitcoin/@benkalashnikov/benkalashnikov-trading-fund-is-22-this-week-beating-bitcoin

This just blew my mind 😮 I follow what they show , maybe I should look into the math first

So informative, thanks for sharing

verynice blog

I am sorry but I cannot agree with your analysis. My mind cannot logically make the jump to assume that 55 billion locked-up ripple is best represented by multiplying that number by the current price. This assumes far too many intangibles... And it simply ignores supply and demand. The 55 billion ripple will, simply speaking, dilute the value before any market adjustments. It is planned inflation. I think ripple is a decent investment, but there are so many factors to assume here-- most notably that more than half the supply is unobtainable right now, which restricts the supply and increases the price as demand for ripple spiked over the last month. The biggest coin is bitcoin.

  ·  7 years ago Reveal Comment

Ripple = The Fed of crypto.

Hello @jrcornel. I really liked your article because I've just been reading about ripple in recent days, and I want to buy this coin. Can you please recommend a website where to buy ripple? I follow you on Steemit

This is a superb technical analysis, very in depth with good numerical back up. Thanks @jrcornel

the more I hear about Ripple the less I like it.

@jrcorner, great post! I never thought about it this way! Someone should create a website that shows the market cap values for all coins using the total number of coins that will ever be available. That would rank Ripple as #1 like you said, or what another coin with a huge supply take the number one spot?

Followed!

Make sure to check my latest post on the growth of Ripple in the past month and follow back ;)

Thanks for giving you an important blog about Bitcoin

Interesting take on this. I'm not sure I totally agree with the logic, seeing as how much of Ripple is "locked up." But you got me to think about Ripple more today. Which was probably the point all along.

Good post! The question of which coin has the largest market capital could be debatable, as bitcoin is no doubt waxing stronger in the currency market. As you the expert has opined, the likelyhood of other coins over taking its position is there. I follow and upvote you.

So nice informative post. Thanks for sharing.

If you are looking for the system with the largest cap it is Ethereum. All the ERC20 tokens run on Eth.

Ripple is the antithesis of crypto. Not decentralised and controlled by A single entity and serves the Banking sector.

Ripple for me is a way to transition to what we really want many, is that banking change the way we operate as we know it now

I read through your article. But I'm a bit wondering that ripple is holding 61% of the coins.

Isn't it one key principle/assumption for the whole crypto/blockchain world to empower the individuals and take power from the "large corporations" who want to own and control everything.

i think ripple will be #1 next weeks !

Good post

Nice Information ...i think LTC is for me ...winks

@jrcornel i think Bitcoin will be the world top currency in future and trading will be done in future through Bitcoin i think so

Analytical technical research. Hmmm!!!!!
Whats your projection for ripple by the end of 2018?

@jrcornel Numbers don't lie :) Thanx for the info.

Ripple has a good potential for growth. But it is centralized, therefore it should be considered as a speculative means for earning. Apparently, recently such a strong growth of Ripple has occurred exceptionally on positive news, which understood it upward.
We live at such a time that a new revolutionary technology can emerge that surpasses all others and bypasses the capitalization of all. Technically, this is also possible.
Thank you, interesting article

Brother very good your post. Greetings from Venezuela

very good your post

not steem

informative post thanks for sharing

  ·  7 years ago (edited)

ohhh @jrcornel i also think that and this a best review ever i read againt coinmarketcap after reading your article now ii am able to explain anyone how ripple have more cap then btc and for a help full artical @jrcornel i wanna know more about it maywe talk in private i want explain you something more about coinmarketcap hope these information will help you for your next artical about @crypto

Sorry bud, but this isn't even hypothetically true, let alone "technically". That's like Zimbabwe saying if we print more money it will all be worth the same.

Its the very reason Ripple made the announcement to lock away such a large portion of XRP in the first place. If they did release it all at once, the price would very much tank, and the market cap would in all probability suffer even more from panic sellers.

The value of any coin has to be linked to its utilisation on the network. Even if it exists in principle, being locked away is as good as an unprinted dollar bill on a printing press. That is what drives demand for a coin in the long run. Hence, why no matter the speculation, a coin always has to have utility in order to justify price at some point.

Ripple very much does have a coin with immense potential, so even with the potential billions coming into circulation, utility and speculation may very well continue outstrip inflation for some time to come.

Thank you so much for posting this. I've been trying to explain this to my friends for weeks now! I told them they should get in on XRP back at $.24 but no one believed in a "penny stock" as they called it.

Ripple is perhaps the secret weapon of the bankers. The system is centralized, the issue is infinite, the printing press only in the single hands, key players and investors — the banking system. Very similar to the FED.

I do not believe in the term market cap.
Everyone can't sell all their coins for the market price.
So, it is really a bogus number.

Further, it really should include only the coins that are currently floating. Not those lost or HODLed.

So in other words all the work that has been done to get away from banks is undermined by individual greed.

Crypto is still like a alien language to me. I'll probably have to bust out a dictionary and read your post 5 more times just to get every gem in the article. Lol. Thanks for another great article @jrcornel

I tend to disagree with that. If Ripple will insert the rest of the coins into the market, there will be inflation... a lot of it! The value of the current coins will decrease and the market cap will remain the same. Of course there will be a lot of factors involved in the evolution of the price of XRP, bud judging only about offer and demand, this is exactly what is going to happen.

Insightful!

There is ACoin. It has two hundred billion in total. I sold one ACoin at $9. Hence hypothetical analysis means the total market cap is 200 000 000 000 X 9 = 1.8 trillion dollars. Not true. All the coins should change hands at least once to qualify as true market cap.

I wonder why people are paying so much attention on the market cap. Crytos are not stocks, they are just another type of merchandises. Say if I spend $500 to buy an used iPhone, and if Apple totally sold 100 billion iPhones. There's no way to say the market cap of Apple is $50 trillion.

thanks very much for this brilliant information.

Ripple is FAKE crypto ... simply just protocol for banks

This is a superb technical analysis, very in depth with good numerical back up. Thanks @jrcornel

Upvote please

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