Why is Market Cap IMPORTANT in Crypto?

Summary

Market cap is one of the most used metrics in crypto — but it's often misunderstood. CoinGecko explains what it measures, why a lower price doesn't mean a coin is 'cheaper', the difference between market cap and FDV, and its limitations as a metric.

Key Concepts

Things To Remember

• Market cap = current price × circulating supply.
• A coin with a low price is not necessarily 'cheap' — market cap matters more.
• Market cap is used to rank and compare relative size of cryptocurrencies.
• Market cap does not reflect the total amount invested in a project.

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