March 6, 2021

Why some cryptocurrencies are worth $40,000, while others stay at $0.40

At the time of publication, one Bitcoin (BTC) values $47,247, while one Dogecoin (DOGE) is worth around $0.068. If you are new to crypto or markets, you may initially think: Hey, DOGE is cheaper than Bitcoin, and if it picks up enough steam, maybe it could catch up to BTC and rise over $20,000, too. This way of thinking, however, is illogical. Why? Market capitalization and asset supply. 

Market cap is the combined dollar value of an asset’s circulating supply. It changes as the value of a given asset rises and falls. Crypto metrics websites, such as CoinMarketCap, rank each cryptocurrency in order of market cap. Bitcoin is the long-standing front runner in this category, holding a market cap of about $879 billion at the time of publication.

Market cap takes each asset’s circulating supply into account. Circulating supply is the amount of any given asset freely moving around the market. Multiply the circulating supply by the asset’s price and you get its market cap.

Assets with more circulating supply often trade at cheaper prices in terms of dollar value per coin or token. BTC currently holds a comparatively low circulating supply of about 18.6 million, and even
Did you miss our previous article…
https://cryptospecialist.org/crypto/6-questions-for-eden-dhaliwal-of-conflux-network/