Market capitalisation is the headline number used to rank cryptocurrencies against each other. It is the current price of one unit multiplied by the circulating supply, so a coin trading at $2 with 50 million units in circulation has a market cap of $100 million. Two coins can trade at wildly different prices and still be worth the same in total, which is why price alone tells you very little about an asset's size.
The figure moves for two reasons: price changes, and supply changes. A token that unlocks new units into circulation will see its market cap rise even if the price stands still, and a project that burns tokens shrinks the number without touching the price. Because supply figures are reported by projects themselves and are not always audited, market cap is a useful ranking tool rather than a precise measurement.
Is a higher market cap better?
It measures size, not quality. A large market cap generally means deeper liquidity and a longer trading history, which makes a position easier to enter and exit; it says nothing about whether an asset is correctly valued.
Last updated October 17, 2026