Why do you need to know about cryptocurrency market cap?

in hive-183397 •  15 days ago 

Assalamu Alaikum


How are you? By Allah's grace, I'm doing very well. What I will discuss with you today is cryptocurrency market cap. Knowing the market cap is very important to know whether a crypto coin is good or bad.

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Crypto market, share market or how strong or weak a company is financially, as well as the reach of investment, can be easily known on the basis of market cap or capitalization information. Market cap is divided into three parts for ease of understanding. If you can figure out which category a random crypto coin falls into, then you can easily tell how this coin will perform in the market or how it will grow, how much it will be stable, etc. and the information will help you make your investment decision. Market capitalization is the total value of a cryptocurrency (basically refers to the size of random coins in the crypto market). Now we will discuss how you can find the market cap. After multiplying the total coin circulation with the current price of a random coin, the total amount that will come is the market cap or market capitalization, if you don't understand, I will explain it more simply. For example, the total supply of Bitcoin is 21 million and 20 million Bitcoins have been mined so far, so the amount of coins mined is the circulation supply. One thing you need to remember is that Total Supply and Circulation Supply are not the same, Total Supply is the number of coins currently in the market and Circulation Supply is the amount of coins that are available to the general public. Now understand the market cap, for the convenience of your understanding, assume that the current market price of Bitcoin is 75 thousand dollars and the current market circulation of Bitcoin is 20 million. According to the formula, the amount obtained by multiplying it by two is the market capital.

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We have come to know about market capital, now we will know which market cap is good and which is bad. A coin whose market cap is more than ten billion is a large market cap. This type of market category is very safe as well as perfect for long term investment as it is impossible to confuse this type of market. Coins whose market cap is between 1 billion and 10 billion dollars are called medium market cap. The growth of coins in this category is very high, that is, such coins gain the trust of everyone in the market and help create the field for doing good things in the future. Now let's talk about small market cap. The market value of this coin is less than one billion dollars and investing in this category of coins is very risky. Because such coins can be easily confused in the market.

Today's discussion concludes here. I hope you've found it interesting. Please share your thoughts on today's topic. Prayers for everyone. May everyone be well. Amen.

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Upvoted! Thank you for supporting witness @jswit.

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It is a great post of Why do you need to know about cryptocurrency market cap?.