Rate is just one way to determine a cryptocurrency’s value. Financiers use market cap to tell a more total story and compare value throughout cryptocurrencies. As an essential figure, it can suggest the growth potential of a cryptocurrency and whether it is safe to buy, compared to others. For a cryptocurrency like Bitcoin, market capitalization (or market cap) is the overall value of all the coins that have been mined. It’s computed by increasing the number of coins in circulation by the existing market price of a single coin.
From Bitcoin and Ethereum to Dogecoin and Tether, there are thousands of different cryptocurrencies, which can make it frustrating when you’re very first getting going in the world of crypto. To help you get your bearings, these are the leading 10 cryptocurrencies based on their market capitalization, or the overall value of all of the coins currently in circulation.
One method to think of market cap is as a rough gauge for how stable an asset is likely to be. (It’s crucial to note that even Bitcoin, crypto’s most significant market cap, still sees volatility.) However the same way a bigger ship can safely navigate heavy weather, a cryptocurrency with a much bigger market cap is more likely to be a more stable investment than one with a much smaller market cap. Alternatively ติดดà¸à¸¢à¸”à¸à¸—คà¸à¸¡ with smaller sized market caps are more susceptible to the impulses of the marketplace– and can see huge gains or significant losses in their wake.
Market capitalization (or market cap) is the total dollar value of all the shares of a business’s stock– or, in the case of Bitcoin or another cryptocurrency, of all the coins that have actually been mined. In crypto, market cap is computed by increasing the total number of coins that have been mined by the cost of a single coin at any offered time.
5 years back, if you wished to inquire into the state of the cryptocurrencies market, the first concern you would ask would most probably be about the price of Bitcoin. Although having already lost much of its synonymity with crypto and blockchain technology in general, Bitcoin was still considered as the essential industry anchor and the most reliable sign of what was to come.
Calculating the stock exchange’s capitalization is normally done by multiplying the last cost of the stock trading by the overall variety of stocks in public flow. When it comes to ‘traditional shares’, the value of shares is backed by economic principles such as total assets (liquid assets, tangible assets and intangibles) and forecasted future cash flows. As a result, standard stock prices and total capitalization value are quite reflective of the overall state of a company. With crypto, this relationship is more uncertain. Cryptocurrencies have no liquid assets, no tangible assets, and extremely limited intangible ones that can back and justify their current cost and market capitalization.
Terra is a blockchain payment platform for stablecoins that depends on keeping a balance in between two kinds of cryptocurrencies. Terra-backed stablecoins, such as TerraUSD, are tied to the value of physical currencies. Their counterweight, Luna, powers the Terra platform and is used to mint more Terra stablecoins.
Terra stablecoins and Luna operate in performance according to provide and demand: When a stablecoin’s price rises above its tied currency’s value, users are incentivized to burn their Luna to create more of that Terra stablecoin. Likewise, when its value falls compared to its base currency, this motivates users to burn their Terra stablecoins to mint more Luna. As adoption of the Terra platforms grows, so too does the value of Luna.