Washindani: Market Crypto Caps - Prices, Highlights All-Time, Charts

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Nomics:CryptoMarketCaps-Prices,All-TimeHighs,Charts/*GlobalDeltaColor*/:root{--delta:hsla(355,100%,50%,1);--delta-hsl:355,100%,70%;--delta-h:355;}thelargestcryptoindexAssetsExchangesConverterWatchlistMore...AdvertiseAPIKeySearchAPIKeymenu1D1D1W1M1YYTD🌎TheWorldx27;slargestIndexofCryptoassets.Getlisted→USDAdvertiseHere⭐️WatchlistAllCryptoCategoryBlockchainTopCryptocurrenciesbyMarketCap72,402(4,222areActivelyTraded)HighlightsStateoftheMarketTotalcryptomarketcapis$1.16T,whichisdown-2.65%overthelastday.Thisvaluesallcryptoassetsat15.74%ofGoldx27;smarketcap.24hourglobalcryptovolumeis$62.29B,representinga-34.22%decrease(96%ofthisvolume,or$60.01Bistransparentvolume).Bitcoindominanceis46%,whichrepresentsa-1.27%slippeoverthelast24hours.ReadMoreBitcoin$27,884.84-1.46%🔥JustAdded1ArbitrumWeb3ID+63.67%2YUHUANG+296.82%TopGainers(Top100)1Monero+1.24%2EOS+1.08%GlobalMarketCap(24hr)$1.16T-2.65%GlobalVol.(24hr)$62.29B-34.22%⚡️ActivelyTraded🔥New64☠️Deadcoins🏷NotPricedMarket DataCovereFreeCSV#NameMCapPricePrice1DChange7DPredictionMCapMarketCapVolumeTransparentVol.CirculatingSupply1DChartCSVData1Bitcoin BTC$538.93B$27,884.84-1.46%-1.46%Unlock$538.93B$25.08B94%19,327,125BuyData2Ethereum ETH$214.08B$1,749.38-4.43%-4.43%—$214.08B$3.67B79%122,373,866BuyData3Tether USDT$79.33B$1.01070.28%0.28%—$79.33B$31.88B93%78,486,103,416BuyDataGetTheLatestCryptoPrices&NewsDeliveredStraightToYourInboxLearnMore→4BinanceCoin BNB$50.80B$321.76-3.14%-3.14%—$50.80B$191.94M84%157,895,234BuyData5USDCoin USDC$34.63B$1.0093-0.41%-0.41%—$34.63B$654.36M84%34,310,557,801BuyData6XRP XRP$21.58B$0.-4.83%-4.83%—$21.58B$399.25M75%50,950,912,949BuyData71Cardano ADA$12.44B$0.-2.93%-2.93%—$12.44B$124.52M63%34,020,260,422BuyData81HEX HEX$11.58B$0.-19.09%-19.09%—$11.58B$5.36M100%137,694,148,650BuyData9Dogecoin DOGE$10.31B$0.-4.45%-4.45%—$10.31B$105.51M84%138,654,346,384BuyData10Polygon MATIC$9.89B$1.0896-3.25%-3.25%—$9.89B$191.84M89%9,080,469,069BuyData111BinanceUSD BUSD$1.00780.01%121Solana SOL$20.68-6.74%13Polkadot DOT$6.0702-4.52%14Litecoin LTC$90.93-3.34%15ShibaInu SHIB$0.-3.69%16TRON TRX$0.-2.79%17alanche AX$17.07-3.54%18Dai DAI$1.0069-0.02%19WrappedBitcoin WBTC$27,893.73-1.06%201ChainLink LINK$7.2825-3.85%211Optimism OP$2.2191-10.06%22Cosmos ATOM$11.26-4.65%23TheOpenNetwork TONCOIN$2.1147-2.56%242Monero XMR$157.931.24%25EthereumClassic ETC$20.14-3.08%262UniswapProtocolToken UNI$5.9552-5.94%27BitcoinCash BCH$124.34-3.49%28Stellar XLM$0.-4.32%29Filecoin FIL$5.5707-5.66%30TrueUSD TUSD$1.00870.10%31Aptos APT$12.30-6.57%32LidoDAO LDO$2.1376-9.27%33HederaHashgraph HBAR$0.-3.58%34Quant QNT$122.70-3.93%35Cronos CRO$0.-4.19%36NearProtocol NEAR$1.9692-4.34%37VeChainThor VET$0.-3.01%381Algorand ALGO$0.-4.33%392ApeCoin APE$4.0353-2.84%40Dfinity ICP$4.9696-4.57%413Stacks STX$1.0206-13.05%423EOS EOS$1.17511.08%43Fantom FTM$0.4593-7.06%442CryptoInternational CRI$0.-7.87%451TheGraph GRT$0.-7.18%46TheSandbox SAND$0.-4.92%47Decentraland MANA$0.-3.93%481Elrond EGLD$42.52-2.56%491Ae AE$73.59-5.07%504Frax FRAX$1.00390.53%511Tezos XTZ$1.1343-3.48%52Flow FLOW$0.-4.14%532AxieInfinity AXS$8.2985-4.47%541ThetaToken THETA$1.0118-3.58%55BitDAO BIT$0.-4.33%561ImmutableX IMX$1.1390-5.42%571Chiliz CHZ$0.-3.13%581NEO NEO$12.450.72%591KuCoinToken KCS$8.8868-2.37%60SynthetixNetworkToken SNX$2.5455-5.29%612PaxDollar USDP$1.0128-0.58%623HuobiToken HT$3.6789-0.42%631RocketPool RPL$38.68-4.43%641inch 1INCH$0.-2.47%653GatechainToken GT$5.1395-2.89%661TerraLunaClassic LUNC$0.-3.99%672MinaProtocol MINA$0.-2.72%682CurveDAOToken CRV$0.-5.80%692Klaytn KLAY$0.-2.60%709ConfluxToken CFX$0.-12.04%712PancakeSwap CAKE$3.6906-2.88%72Dash DASH$61.12-3.19%733BitcoinSV BSV$35.45-5.32%74Maker MKR$668.83-2.30%752TIME(Wonderland) TIME$11.750.83%761eCash XEC$0.-4.71%772BitTorrentV2 BTT$0.72-2.12%782MaskNetwork MASK$5.8189-2.00%791IOTA(MIOTA) IOT$0.-4.25%804FraxShare(ERC-20) FXS$7.7858-4.89%811PAXGold PAXG$2,010.62-0.51%821TokenizeXchange TKX$6.1717-2.22%831TrustWallet TWT$1.1798-2.37%843XDCNetwork XDC$0.-11.28%851Loopring LRC$0.-5.62%861RenderToken RNDR$1.2262-8.84%87Zilliqa ZIL$0.-4.63%88Osmosis OSMO$0.-3.21%89THORChain RUNE$1.3869-3.84%90Arwee AR$8.0651-5.29%917Nexo NEXO$0.-0.46%923Ka KA$0.-3.17%933EnjinCoin ENJ$0.-3.52%941GeminiDollar GUSD$0.-4.60%953Zcash ZEC$35.88-5.07%965ConvexFinance CVX$5.0883-7.20%973CasperNetwork CSPR$0.-4.86%981Fetch FET$0.-5.11%991DeFiChain DFI$0.-3.20%1001dYdX DYDX$2.4245-7.09%FirstPrev1234...43NextLastAdvertiseHereFrequentlyAskedQuestionsWhatiscryptomarketcap?Marketcapitalizationisoneofthemostpopularmetricsinfinance.Itwasfirstintroducedinthestockmarketandhasbeenadaptedtothecryptoworldwhereitisusedtovaluecryptocurrencies.Cryptomarketcaphasitssupportersanditscritics.Supportersviewmarketcapasasimple,albeitincompletewaytorankcryptoassetprojects.Criticsinsistthatmarketcapisnotameasureofvaluebutacrudeexpressionofthepriceinvestorsarewillingtopay.Bothsidesmakevalidpoints.Cryptomarketcapiscalculatedbymultiplyingthecirculatingsupplyofacoinbyitscurrentprice.Forexample,ifadigitalcurrencyhas1,000tokensincirculation,andeachtokentradesat$100,themarketcapitalizationoftheprojectis$100,000.Aswithstocks,cryptocurrenciesareclassifiedintermsofmarketcap.Large-capcryptocurrencieshemarketcapsinexcessof$10billion,mid-capcryptocurrenciesrangebetween$1billionand$10billion,andsmall-capcryptocurrenciesareworthlessthan$1billion.Intheworldofstocks,thehigherthemarketcap,thesafertheinvestment.Intheworldofcryptocurrencies,ahighmarketcapislessmeaningful.Ifthemarketcapofacryptoassetishigh,itmeansthatittradesatahighprice,hasahighcirculatingsupply,orboth.Ifthemarketcapislow,itsignalsthatthepricepercoinislow,thereislittlecirculation,orboth.Thisisallthatmarketcapcanrevealaboutacryptocurrency.Nothingmore.Itcan’texpresswhethertokensareheldbyanetworkofsmallinvestorsorahandfulofwhales,itdoesn’tspeaktoliquidity,anditissilentonmaxsupply.Cryptomarketcapisasourceofcontroversy.Therearethosewhoclaimthatmarketcapreflectstheamountoffiatcurrencyinvestedinacryptoasset.Thisiswrong.Consideraninfluxofnewinvestorstoaprojectwithlowtradingvolume.Duetothemarket’slackofdepth,thesuddeninterestdramaticallydrivesupprices.Let’ssaythatthetokengoesup50%,fromamillion-dollarmarketcapto$1.5million.Doesthatmeanthattheinvestorspumpedin$500,000?Absolutelynot.Thenewmarketcapmerelyreflectsthepricethatthelastinvestorwaswillingtopay.Anotherexample:takeanewcryptocurrencywithacirculatingsupplyof100,000.Itgoeslive,andthefirstinvestorbuysatokenfor$5.Oncethattradeisexecuted,theprojectwillheamarketcapitalizationof$500,000.Yetonly\$5changedhands.Allthatsaid,whenconsideredwithotherindicators,cryptomarketcapcanbeuseful.It’squitecommontolookatmarketcapalongsidemetricsliketradingvolumeandliquidity.Tradingvolumereferstothenumberofcoinsbeingtradedacrosstheworld’scryptocurrencyexchanges.Liquiditymeasuresthedegreetowhichanassetcanbeboughtorsoldwithoutcausingamajorpricechange.Inmostcases,highvolumeandhighliquiditymeanahealthymarketthatisdifficulttomanipulate.Indeed,aclassicwaytomeasurethequalityofacryptocurrencyistocheckwhetheritstradingvolumeisequaltoorgreaterthanitsmarketcap.Cryptomarketcaphasmajordrawbacks,yetitremainsthego-toindicatorformanyinvestors,analysts,andcommentators.Thisisunfortunate.Atbest,marketcapcanserveasajumping-offpointforevaluatingacryptocurrency.Butitisonlytrulyhelpfulwhenusedintandemwithothermetricsliketradingvolume.Whydoescryptomarketcapmatter?Althoughmarketcapis,atbest,anincompleteindicatorofcryptoassetquality(moreonthathere),insomecases,itcanbeausefulstartingpointforanalyzinganinvestmentopportunity.Marketcaprevealsabitaboutacoin’scharacteristics.Forexample,highmarketcapcouldindicatethatacryptocurrencyisresistanttovolatility.Lowmarketcapindicatestheopposite,thatmajornewseventsorwhaleactivitycansignificantlyimpactprice.However,cryptomarketcapcanonlytakeyousofar.Togetastrongreadonvolatility,you’dhetocombinemarketcapwithothermetricslikemarketdepthortransactionvolume.Traditionally,stocksareanalyzedwithmetricssuchasprice-to-earnings(P/E)andearnings-per-share(EPS).Cryptoprojectsdon’tpublishfinancialstatements,butthereisstillaneedforcomparison.Overtime,thesimplicityofmarketcaphasmadeitthemostpopularwaytocomparecryptoassets.Forthisreasonalone,cryptomarketcapmatters.It’simportantbecausecryptoinvestors,exchanges,gregators,andprojectownersthinkit’simportant.Experiencedinvestorswillusuallyconsidermultipleindicators,buttherearesomewhobasetheirdecisionsexclusivelyonmarketcap.Cryptoexchangesusemarketcapasawaytodeterminewhichcoinstolist–coinswithhighercapsaremorelikelytomakeit.Exchangedatagregatorstendtorankprojectsbymarketcap.Thehigheranasset’smarketcap,themoreprominentlyitwillbefeaturedonthesite.Projectownerstakemarketcapseriouslyenoughtospendtimeandmoneymanipulatingthecirculatingsupplyorpriceoftheirtokens.Thisisjustonereasonwhycryptomarketcapisconsideredamisleadingorunreliableindicator.Tosummarize,cryptomarketcapmattersbecauseit’seasytounderstandandadecentstartingpointforanalyzingacryptoasset.It’salsoimportantbecausesomanyplayersconsiderittobeimportant.Asthecryptospacematures,bettertoolswillbedevelopedthatwillprovidemarketparticipantswithin-depth,actionableinformation.Whenthathappens,marketcapwilllikelyloseitsplaceastheleadingcryptoindicator.Whatisthecryptomarketcapall-timehigh?Asofthiswriting,theglobalcryptomarketcapall-timehighisjustover$3trillion($3,149,435,050,780USD).ThemarketreachedthislevelonNovember8,2021.HowcanIcalculateacryptocurrency’smarketcap?Cryptomarketcapiscalculatedthesamewayasstockmarketcap,bymultiplyingthecirculatingsupplyofanassetbyitspriceinfiatcurrency(e.g.USD,EUR,JPY).Thecalculationgetstrickierwhenanassetistradedainstanotherasset.Inacryptopair–let’ssayEthereum/BitcoinorETH/BTC–togetthepriceofETH,wewouldfirstdenominateBTCinfiat.Inordertounderstandmarketcap,it’simportanttoconsideritsconstituentparts–priceandcirculatingsupply.Pricedependsonwhomakesthecalculation.Thegeneralpriceiscalculatedasacompositeofspotpricesusedoncryptoexchanges.Forindexfunds,thecalculationisadjustedtoincludevariationintradingpairprices.Thepricethatyouseeononlinenewsgregators(Google,forexample)isusuallytheerepriceatwhichanassettradesonleadingexchanges.Inthecryptospace,theproblemofinadequatepricingiswell-known.Mostpricingindexissuersfailtodetailhowtheypriceinstrumentsorwheretheygettheirdata.AtNomics,westrivetosetthisright.Ourmethodologytakesthepriceatwhichaninstrumentlasttradedoneachexchange,weightedbythegeneraltradingvolumeoverthepast24hours.Moreonourmethodologyhere.Whenitcomestosupply,itisworthnotingthatthecalculationdependsentirelyonthetokenandthemechanicsofitsprotocol.AlthoughBitcoinhasafinitesupply(21million),mosttokensaredesignedwithadynamicsupplythatincreasesovertime.WhencalculatingthemarketcapofWashindani: Market Crypto Caps - Prices, Highlights All-Time, Chartsaparticularcryptoasset,itisthecirculatingsupplythatshouldbetakenintoaccount.Circulatingsupplyisthenumberoftokensthatarecurrentlyailableonthemarket.Circulatingsupplyisabettermetricthantotalsupplybecauseitexcludescoinsthatarereservedorlocked.WhatisBitcoin’smarketcap?Bitcoin(BTC)istheworld’sleadingcryptocurrencybymarketcap.Intermsofmarketcap,Bitcoinhasreachedheightsofover$1trillion.TofindBitcoinx27;smarketcap,locatethevalueinthe"marketcap"columnassociatedwiththeBitcoinrecordinthetableabove.Aswithothercryptoassets,Bitcoin’smarketcapisdeterminedbymultiplyingitscirculatingsupplybyitscurrentprice.Itisworthnotingthat,duetothefinitesupplyofBitcoin,atsomepoint,circulatingsupplyandtotalsupplywillbeequal.Atthattime,Bitcoin’smarketcapwillheonlyonedynamicdeterminant,theprice.Bitcoin’scurrentcirculatingsupplyhasalreadyreached85%ofthemaximumsupply,whichisfixedat21million.HowcanIfindlowmarketcapcryptocurrencies?Someinvestorsviewlowmarketcapassynonymouswithhighprofitpotential.Similartopennystocks(stockspricedbelow\$1),low-capcryptocurrenciesareoftenconsideredtobeundervalued.Thatiswhymanymarketparticipantsforcryptocurrencieswithlowmarketcaps.Theybelievethesecurrencieshemoreroomforpriceappreciation.Othersviewlowmarketcapcryptocurrenciesasground-flooropportunities.Whateverthereasoning,lowmarketcapcryptocurrenciesarepopularinvestments.Here’showtofindlowmarketcapcryptocurrenciesontheNomicsplatform:NigatetoNomics.com.Sortcryptocurrenciesbymarketcap.Movebeyondpe1toexplorelowmarketcapcryptocurrencies.Nomicslistscryptocurrencieswithmarketcapsaslowasafewhundreddollars.However,youshouldoidchoosinganinvestmentbymarketcapalone.Consideradditionalfactorssuchasrecentpricechanges,tradingvolume,circulatingsupply,andtransparentvolume,afeatureuniquetoNomicsthatshowsthepercenteoftradingvolumethatoccursonreputablecryptocurrencyexchanges.Formoreontransparentvolume,seehere.Howismarketcapcalculatedforstocks,andhowdoesthisdifferfromcryptomarketcapcalculations?Marketcapitalizationisoftenusedtoindicatethevalueofacompanyorstock.Itiscalculatedbymultiplyingthetotalnumberofsharesoutstandingbythepricepershare.Investorscalculatethevalueofacryptocurrencybymultiplyingitscirculatingsupplybyitscurrentprice.Thoughstockandcryptoinvestorsusethesameindicator,thecalculationdiffersinsomerespects.StockmarketcapcalculationTocalculatethemarketcapofacompany,multiplysharesoutstandingbythecurrentpricepershare.Let’stakeaminutetoexaminebothcomponentsoftheequation.Sharesoutstandingreflectsallstocksthatarecurrentlyheldbyshareholders.Itevenincludesrestrictedshares(heldbycorporatestaff)andshareblocks(heldbyinstitutionalinvestors).Price,ontheotherhand,isaffectedbyinternalfactorssuchasprofit,expectedprofit,andplansforgrowth.Howinvestorsperceivethesefactorsinfluencessupplyanddemandanddeterminesthepriceofastock.CryptomarketcapcalculationTofindthemarketcapofacryptocurrency,multiplycirculatingsupplybycurrentprice.Circulatingsupplyissimilartosharesoutstandingbutonlyincludestokensthatareailableinthemarket.Itexcludescoinsthatarereservedorlocked.Thepriceofacryptocurrencyisusuallycalculatedasanereofthespotpriceatwhichtheinstrumenttradesonleadingexchanges.Cryptocurrencypricinginthecontextofindexfundshappensinaslightlymoresophisticatedwayandisadjustedtoincludevariationintradingpairprices.ThedifferencesAlthoughmarketcapisusedtovaluebothcompaniesandcryptocurrencies,therearedifferencesinthewayitisapplied.Forinstance,sharesoutstandingtakesintoaccountallissuedshares,includingthoseheldbycorporateofficersandbiginvestors.Circulatingsupplyignoresreservedorlockedcoins.Asaresult,cryptomarketcaponlyincludesassetsthatareailablefortrading.Ifcryptomarketcapfollowedthesamelogicasstockmarketcap,itwouldbebasedontotalsupply.Afarmoreaccuratecalculationisachievedbyusingcirculatingsupply.Formoreontheconsofusingtotalsupply,seethenextquestionbelow.Anotherdifferenceispricingmechanics.Whilemoststockshefixedissuancemechanisms,inthecaseofcryptocurrencies,manyprotocolsaredesignedtoexpandcontinuously,thusinflatingtokensupplyovertime.Ingeneral,cryptomarketcapisn’tconsideredtobeasaccurateasstockmarketcap.Oneofthereasonsisthat,unlikethestockmarket,whereahighmarketcapindicatesasafeinvestment,intheworldofcryptocurrencies,highmarketcapdoesn’tnecessarilymeanthataninvestmentissecure.Anotherreasonisthefactthatcryptocurrencycomeswithcertainrisksthatdon’texistwithstocks.Tocompensate,onemustanalyzemarketcapinabroadercontext.Whataresomeproblemswithhowcryptomarketcapiscalculated,andwhatalternativesexist?Theoldest“modern”securitiesmarketintheworldistheAmsterdamStockExchange,whichwasfoundedin1602bytheDutchEastIndiaCompany.Thefirstcryptocurrency,Bitcoin,waslaunchedin2009.Thisgoestoshowhowyoungthecryptocurrencymarketiscomparedtothestockmarket,whichhashadcenturiestomature.Weoftenmakethemistakeofcopyingstockmarketmetricsandtryingtoshoehornthemintotheworldofcryptocurrencies.Soisthecasewithmarketcapitalization.Marketcapisappliedtobothstocksandcryptocurrencies,buttherearedifferencesinhowthemetricworksineachcase.Intheworldofstocks,marketcapcanrevealmuchaboutacompanyincludingcorporatepolicies(forexample,theissuanceorrepurchaseofshares),manementstyle,andoperationalscale.Itisoftenusedforitssimplicityandrelativeeffectivenessatassessingthequalityofastock.Whenitcomestocryptocurrencies,however,marketcapisnotausefulbasisformakinganinvestmentdecision.Infact,manyresearchersdescribecryptomarketcapasadeceivingindicatorthatisusedonlybecauseitissimple.Despiteallthat,marketcapcontinuestobeusedasaleadingindicatorofcryptoassetquality–evenbyexperiencedinvestors.Thisisamistake.ThepitfallsofcryptomarketcapStocksandtokensheverydifferentcharacteristics.Stocksrepresentownershipofacompanythatcreateseconomicandsocialvalue.Dependingonthetypeofstock,ownershipcanprovideashareholderwiththerighttoreceivedividends,vote,andparticipateinproceduresaimedatraisingliquidity.Tokensrepresentparticipationinanetworkthatmayormaynotgeneratevalue.TokensdonotguaranteeclaimsonprofitsorparticipationinsalesorICOs.Atoken’spriceisbasednotonreal-worldfactorsthatinfluencesupplyanddemandbutonspeculationaboutaproject’spotential.Thetruthis,whiledigitaltokensareanexcitingassetclass,theyarefundamentallydifferentthanstocks,andusingthesameindicatortoanalyzethemcanresultinfalseorunrepresentativeconclusions.Anotherproblemwithcryptomarketcapistokeninflation.Withstocks,thetotalsupplyisfixedandcanrarelybechanged.Theonlywaytochangeitisviaastocksplit.Whenitcomestotokens,however,anemissionschedulecanguaranteeaninstrument’scontinualinflation.Theincreaseincirculatingsupplythattakesplaceovertimeleadstoahighermarketcap.Butahighermarketcapdoesn’tnecessarilymeanthataprojectisdoingwell.Itcouldjustmeanthattherearemoretokensincirculation.Andvice-versa–alowermarketcapdoesn’tnecessarilymeanthataprojectisstruggling.Itmaysimplyindicatethattherearefewertokensincirculation.Cryptomarketcapwasinitiallycopiedfromthestockmarket.Althoughoneofthefactors,price,ispresentinbothcases,therewasaneedtofindacryptometricthatreplicatedtheroleofsharesoutstanding.Theoptionthatmostresembledsharesoutstandingwastotalsupply–allcoinsortokensthatcurrentlyexistandareeitherincirculationorlocked.Butthisopenedaloophole.Tokenownerscouldartificiallyinflatetheirmarketcapbypre-miningcoinsandlockingthemaway.Inresponse,totalsupplywasswappedforcirculatingsupply–allcoinsortokensthatareailablefortrading,excludingthosethatarereservedorlocked.Circulatingsupplywasintendedtomeasureliquidsupply.Thisraisednewcomplications,namelyhowtodefinewhichpartofsupplycouldbeconsideredliquid.Takelostcoins,forexample.Circulatingsupplyisincapableofjudgingwhichcoinsarelostforever.InthecaseofBitcoin(BTC),itisestimatedthatupto4millioncoinshebeenlost.Ifthesecoinsweretoberemovedfromcirculatingsupply,thecurrency’smarketcapwouldnosedive.Manycriticsofcirculatingsupplysuggestthatthemetrictendstooverestimatetherealsupplyonthemarketbyincludingtokensthataren’tactuallyailable.Perhapsthemostnotablepitfallofthecryptomarketcapcalculationisfoundinthemechanicsofthecryptocurrencymarket.Asthecryptomarkettendstobemorevolatilethanthestockmarket,anysignificantbuyorsellordercanleadtoamajorpricemovementthatwillaffectaproject’smarketcap.Thisiswhyweoftenuseametricknownasredemptionimpactscorewhichmeasuresthelikelihoodofalargeorderaffectingthepriceofacryptoasset.Ahighredemptionimpactscoreindicatesalessstablepricewhilealowscoreindicatesthatanassetcanmaintainarelativelystablepricethroughdynamicmarketactivity.Inreality,themajorityofcryptocurrencieshehighredemptionimpactscores.Anotherdrawbackofcryptomarketcapisthatitispronetomanipulation.MustafaAl-BassamfromUniversityCollegeLondondescribedacasewhere0.002ofthecoinFirstblood(1ST)wasboughtfor$140worthofEthereum(ETH).Thisledto1ST’spricebeingquotedat$69,000percoinandamarketcapof$163billion.Foramoment,1STwastheworld’ssecond-biggestcryptocurrency.Thisdemonstrateshoweasilymarketcapcanbemanipulatedwhenacoinhasmeertradingvolume.Thesameoccurswhenawhale,orlargeinvestorholdingasignificantpercenteofacryptocurrency,decidestodumpitallatonce.Thecryptocurrency’spriceplummets,followedbyitsmarketcap.Anotherwaytoillustratehowinefficientandevendeceivingmarketcapcanbeistoiminethatyouarelaunchingacryptocurrencyproject.Let’ssaythattheprojecthasatotaltokensupplyofonebillion.Ifyousellasinglecoinfor$1,yourprojectisnowworth$1billion.Yetanotherdownsidetocryptomarketcapisitsinabilitytomeasurethevalueofaproject.Cryptomarketcapmerelyrevealsthepricethatinvestorsarewillingtopay.Itdoesnotexpressvalue.Considerovernightpricegains.IfTron(TRX)suddenlyjumps20%,doesthatmeanthenetworkhasaddednewfeaturesorcreatedreal-worldvalueinanyway?Mostofthetime,theanswerisno.Generally,itjustmeansthatpeoplearewillingtopay20%morefortheasset.Onelastthingtobearinmindisthatmarketcapisareflectionofthelastpriceatwhichacryptoassettraded.Allprevioustradeswereexecutedatdifferentprices,andthereisnoguaranteethatthelastpricewillbethepriceatwhichthenexttradeexecutes.Infact,giventhevolatilityofcryptocurrencies,priceisunlikelytoremainthesameforverylong.CryptomarketcapalternativesSeveralalternativesheproventobebetterindicatorsofcryptoassetquality.Thefirstismarketcap’supgradedversion-fullydilutedmarketcap(FDMC),whichoptimizescirculatingsupplybynormalizingdisparitiesinemissionschedules.FDMCbasesmarketcapcalculationsonapointinthefuturewhenanasset’ssupplyiscomparabletothecurrentsupply.Thisnormalizesemissionschedulesbetweenassetstoprovideamoreevencomparison.However,FDMChasitsflaws.Themainoneisitsinabilitytodealwithprotocolsdesignedtoinflatesupplyinperpetuity.Thismeansthatnomatterhowdistantthepointintime,resultsmaystillbeskewed.AnotherpitfallofFDMCisitsassumptionthatpriceswillremainconstantregardlessofchangesinsupply.Realizedcapisanothermarketcapalternative.Itimprovesoncirculatingsupplybyexcludingcoinsthathebeenlostorneveractivated.Theindicatorreliesonunspenttransactionoutput(UTXO),whichisusedbynodestoconfirmthevalidityoftransactions:ifatransactionisn’tpresentinthedatabase,itisn’tconsideredvalid.UTXOhelpsoidtheproblemofdouble-spending,orthespendingofnonexistentcoins.ResearchersuseUTXOtoestimatethenumberofcoinslostovertime–inthecaseofBitcoin(BTC)–andcoinsthatwereneverclaimedoractivated–inthecaseofBitcoinCash(BCH).TheonlydownsidetorealizedcapisthatitstrugglestodifferentiatecoinsthatarelostentirelyfromcoinsthatareHODLedforthelonghaul.Thisleadsustooneofthemostpopularalternativestomarketcap,market-value-to-realized-value(MVRV),whichseekstodeterminehowover-orundervaluedaparticularassetisbyanalyzingwhereitisinitsmarketcycle.MVRViscalculatedbydividingmarketcapbyrealizedcap.Theconceptisthatmarketcaprevealsmarkethypewhilerealizedcapindicateswhetherlong-term,“serious”investorsheenteredthemarket.Theadditionofmarketcycleanalysisenhancesmarketcapandmakesitmoredynamic.Youcanlearnmoreaboutmarketcapalternativesinthefollowingessay.However,itisworthnotingthatcryptomarketcap,oranyofitsalternatives,representasinglewaytoevaluatethequalityofacryptoasset.Thereareotherindicatorsthatprovidestatisticaldataabouttheperformanceofcryptoassetsandcharacteristicsthatmightbedetrimentaltotheirlong-termhealth.Tofullyunderstandthem,wemustfirstlookatthestockmarket.Tofindtherealvalueofastock,analystscalculatethenetpresentvalueofacompany’sprojectedrevenuesordividends.Stockmarketanalystsrelyheilyonrelativevaluationmodelslikeprice-to-earnings(P/E),whichallowsthemtoperformafaircomparisonoftwoinstruments.Cryptocurrencyanalystsheattemptedtoadaptthisframeworkintometricssuchasnetwork-value-to-Metcalfe(NVM)andnetwork-value-to-transactions(NVT).BeforedelvingintoNVM,let’sdefineMetcalfe’sLaw.Thelawisusuallyappliedtoonlinenetworks,butitisalsoconsideredusefulintheworldofcryptocurrencies.Accordingtothelaw,themorepeoplewhouseanetwork,themoreutilityeachpersonderives.Thisalsoleadstoahighernetworkvalue.CryptocurrencyanalystsuseNVMtodeterminehowover-orundervaluedanassetmaybe.Thenextratio,NVT,focusesontransactionvolume.TheratioissimilartoP/Einthestockmarket,whereearningsactasaproxyforthevaluethateachshareholderreceives.Inplaceofearnings,NVTsubstitutesnetworktransactionsanddividesmarketcapbydailytransactionvolume.HighNVTindicatesthatanasset’smarketvaluesurpassesitsactualvalue.LowNVTindicatesanundervaluednetwork.NVTisn’taflawlessindicator.It’snotclearonwhichtransactionsshouldbeconsidered,andthefactthatthereareon-andoff-chaintransactionsincreasesthedifficultyofestimatingtotaltransactionvolume.Anotherwaytodeterminetheliquidityofanassetisthroughbuysupport,whichisthesumofbuyordersat10%distancefromthehighestbidprice.Buysupporthelpsexplainhowliquidaparticularassetisandhowmanybuyordersshouldbeexpected.Inadditiontofactorslikeprice,circulatingsupply,liquidity,andtradingvolume,anetwork’svaluecanalsobeconsideredintermsofsecurity,numberofactivecontributors,andpopularityonsocialmediaandTelegram.Hopefully,thisdemonstratesthatcryptomarketcapisanincompletemetricandthatinvestorswhorelyonitexclusivelydosoattheirperil.Althoughmarketcapisthemostpopularindicatorofcryptoassetvalue,itisinefficientatestimatingassetqualityandstrugglestoprovideactionabledata.Forthesereasons,cryptomarketcapshouldalwaysbebackedbyadditionalmarketmetrics.Howcanacryptocurrencyraiseitsmarketcap?Therearetwowaystoraisethemarketcapofacryptoproject.Thinkofthemasthe“artificial”wayandthe“natural”way.Or,inotherwords–the“bad”wayandthe“good”way.The“bad”wayexistsbecausemarketcapisaninefficientindicatorandpronetomanipulation.We’regoingtofocusonpositive(or“natural”)waystoraiseaproject’smarketcap.Wehealreadyexaminedthedrawbacksofmarketcap.Tosummarize,itpresentsinvestorswithapriceratherthanavalue.Whileahigherpricedoesn’tnecessarilyindicateahighervalue,ahigherreal-worldvaluecanincreasethepriceofatoken.Thismeansthatifyouwanttoraisethepriceofacryptocurrency,focusonincreasingthevalueofthenetwork.Thefirststepistoattractasmanyactiveusersaspossible.Thebiggerthenetwork,themorestableandattractiveitis.VitalikButerin,thefounderofEthereum(ETH),listedseveralcharacteristicsthatincreasethevalueofanetwork:Security–Largernetworksrequireconsensusfrommorenodes,whichmeansmoreresilienceainsthackers.Usability–Merchantadoptionmeansbetterusabilityandmoreconvenienceforconsumers.Andviceversa.Themoreconsumersthatuseaparticularnetwork,themoreattractiveitistomerchants.Integration–Platformswithmoreusersarealsomoreattractivetothird-partyserviceorproductproviders.Themoreintegrationsanetworkhas,themorefunctionalitis.Marketdepth–Biggernetworksusuallyhegreatertradingdepthonexchanges,allowinguserstoconvertlargerquantitiesofacryptocurrencywithoutsignificantlyaffectingitsprice.Reasonablefees–Usersprefercryptocurrencieswithnoorlowfees.Themoreusersacryptocurrencyhas,themorecounterpartiesthereare,whichnaturallydrivesdowntransactionfees.Buthowdoesanetworkreachapointwhereitattractsnewusersonaregularbasis?Beforeanetworkattractsuserscontinuouslyandnaturally,itmustmeetcertainprerequisites.Let’stakealook.Real-worldusecasesForacointobevaluable,itmustheastrongusecase.Aprotocolmustsolveareal-worldproblem.Itcouldtackleamarketpainpointorprovidevaluetoinvestorsintheformofutilityrightsorasamediumofexchangeonaplatform.Whenacoinhasaprovenusecase,thereisanincentiveforinvestorstobuy,hold,orspendit.ConsiderEthereum.Forsomeonetodevelopapplicationsonthenetwork,heorsheneedsgas,whichcomesfromtheplatform’scurrency,ETH.Themoredevelopersthereare,thebiggerthedemandforETH,andthehigheritspricegoes.Theresult:ahighernetworkvalueandahighermarketcap.Theaimofeachcryptocurrencyismassadoption.Thatsaid,hingreal-worldapplicationsremainsadifficulttaskformostcryptoprojects.Itisalongandcomplicatedjourney,butitistherightpathtofollow.__Acointhatisn’tdesignedwithausecaseinmindismerelyatoolforspeculators,withoutanyfundamentalvalue.ScarcityInsomecases,scarcitycanresultinincreasedvalue.Themorerareanasset,themoreexpensiveitbecomes.ThisiscertainlythecasewithBitcoin(BTC).Itsfixedsupplymeansthatitsprotocolcannotcontinuouslyissuenewtokens,andmanyexpertsbelievethatthecloserwegettothemomentwhenallcoinsaremined,thehigherthepricewillrise.Thisprincipleisvalidmostlyforcoinswithreal-worldusecases.Alargenumberofcoinsaredesignedwithcontinuouslyexpandingprotocols.Althoughthisleadstoahighermarketcap,itdoesn’treallyaddvalue.Meanwhile,otherprojectsheanintegrated“burning”mechanismtodestroyaportionoftheirsupplyandincreasethepriceofeachcoin.Scarcityisausefultoolforprojectownerswhowishtocontrolthemarketcapoftheirtokens,butitshouldbeusedappropriately.ListingsonexchangesAnotherwaytoboostmarketcapistogetlistedonasmanyreputablecryptoexchangesaspossible.However,gettinglistedonexchangescannotbethefinalgoal.Manyhepoliciestodelisttokensthataren’tregularlytraded.Therefore,it’svitalforprojectstowaituntilthey’vegainedsomepopularityandbuiltaninitialuserbase.Projectsthatarelistedonleadingexchangesareusuallyconsideredmorereputableandfinditeasiertoattractinvestors.Thisthenleadstohigherliquidity,which,combinedwithahighermarketcap,canturnacryptoassetintoapreferredinvestmentopportunity.Formoreinformationonhowtogetlistedonanexchangeandremainsuccessfulafterward,checkourCryptocurrencyExchangesFAQ.AclearroadmapProjectsthathitroadmapmilestonesontimeheahigherperceivedvalue.Aproject’sopennesstoinnovationandpartnershipswithproventhird-partyserviceproviderscanalsoraisecredibilityintheeyesofinvestors.Backingfromwell-knowncompaniesmeansmoretransparencyandamorenaturalpathforprojectstoestablishthemselvesonthemarket.LoyalfollowersProjectsthatheastableorincreasingbaseoffollowersaremoreattractivetoinvestors:thehigherthenumberofactivecontributors,themoreprogressiveanetworkwillbecome.Thinkofitlikethesnowballeffect–themorepeoplethereareonanetwork,themorewillbeinterestedinjoining.Onewaytogaugeanetwork’snumberofusersisitsnodecount.Nodecountrevealshowmanyactivewalletsexistonanetwork.Thehigherthenumber,thestrongerthenetworkis.Thisiswhymanyinvestorsuseamarketcap/nodecountratiotodeterminewhetheracryptocurrencyisunder-oroverbought.However,ahighnodecountoralargecommunityisnotenough.Projectsmustalsolistentotheirusers,whocanspotpointsoffrictionorrecommendfeaturesthatworkwellonothernetworks.Thetruthis,themarket–oruserbehior–cantellaprojecteverythingitneedstoknow.AreputationfortransparencyThereisnothingmoreharmfultoacryptocurrencythanabadreputation.Manyprojectsdoomthemselvesbydwellingintheshadows,whereit’simpossibletoearnuserorinvestortrust.Therehealsobeenseveralcasesofprojectsusingwhitepaperscopiedfromotherprojectswithoutchanginganythingbuttheorganizationandtokenname.Althoughsomeinvestorswillfallforaboguswhitepaper,itisusuallyarecipefordisaster.Investorsalsotendtooidtokensthatheahistoryofsecuritybreachesorprotocolissues.Thoughthisisn’ttosaythataprojectcan’tsurviveahack.Infact,ifaprojectshowsthatitovercameasecurityissueandbouncedbackstronger,itwillreflectpositivelyonthelong-termvisionoftheprojectandthequalityoftheteambehindit.Insummary,toraisethevalueandmarketcapofacryptoasset,oneshoulddiscloseeverythingabouttheproject(owners’backgrounds,roadmap,futureplans,risks,etc.)andbeastransparentaspossible.MarketingInrecentyears,themarketingofcryptoassetprojectshasbecomeincreasinglyimportant.Competitionforcesprojectstocontinuouslyimprovetheirmarketingcommunicationsandadoptdifferentchannelstodiscovernewaudiencemembers.Marketingdoesn’tstoponceaprojectgoesliveorgetslistedonanexchange.Ifaprojecthasauniqueusecase,there’sachancethatwordwillspreadorganically.However,inmostcases,projectsshouldspendatleastsomemoneyonmarketingandPR.Howbigcanthecryptocurrencymarketcapget?Todeterminethemaximumcryptocurrencymarketcap,weneedmaxvaluesforpriceandcirculatingsupply.Generallyspeaking,thepriceofacryptocurrencyisdeterminedbysupplyanddemand.Unfortunately,demandisalmostimpossibletopredict.Forexample,inthecaseofBitcoin(BTC),wecan’tbesureatwhatpriceitwilltradewhenitreachesitsmaximumsupplyof21million.Itcouldbe$50,000or$500,000.Dependingonoutsidefactors,suchasabanoncryptocurrencies,itmayevendropbelowitscurrentprice.Estimatingthemaximumcirculatingsupplyofallcryptocurrenciescanalsobedifficult.Whilesomeprotocolsdeclareafixedsupply,othersaredesignedtocontinuouslyissuenewtokens.Duetotheseunpredictabledynamicsandthefactthatnewcryptocurrenciesaredevelopeddaily,itbecomesquitehardtopredicthowmuchcryptocurrencywillbeincirculationatanypointinthefuture.Thatsaid,todeterminethemaximumcryptocurrencymarketcap,onewouldhetofindthemaximumcirculatingsupplyofallailablecryptocurrenciesthenmultiplythatbythepricesofthosecurrencieswhentheirrespectivecirculatingsuppliesareattheirmaximums.Let’sseewhatsomeofthefield’sleadingfiguressay.ChangpengZhao(CZ),thefounderofBinance,hassaidthatheseescryptocurrenciessurpassingamarketcapof$200trillion.VitalikButerin,co-founderofEthereum(ETH),believestherex27;sroomforgrowth,butthatit’sunlikelythecryptocurrencymarketreachessuchlevels.Who’sright?Althoughwecan’tknowforsure,wecanmakesomeassumptionsbasedonpresentinformationandexpertprojections.Ifthecryptomarketcapreaches$200trillion,itwillmeanthatcryptocurrenciesrepresentthemajorityoftheworld’swealth.Forthistooccur,theworldfinancialsystemwouldhetoundergoaparadigmaticshift.Banksandhigh-net-worthindividualswouldhetodropcurrentinvestmentsandstoresofvalueinforofcryptocurrencies.Fornow,thisseemsunlikely.AsurveybytheWorldEconomicForumconcludedthatin2027,10%oftheworld’sGDPwillbeheldindigitalassets.AccordingtostatisticsfromtheWorldBank,globalGDPwasapproximately$85.8trillionin2018.Long-termGDPforecastsprojecta2027GDPof$126trillion.Iftheaboveestimatesarecorrect,in2027,$12.6trillionoftheworld’sGDPwillbestoredincryptoassets.ThesefiguresarefarfromCZ’s$200trillion.Togetabroaderperspective,let’stakealookattheworld’smoneysupplyandthewayitisdiversified.In2017,theplanet’snarrowmoney(coins,banknotes,andcheckingaccounts)wasworthabout$36.8trillion.Moreonthathere.AccordingtodatafromtheWorldBank,the2018marketcapitalizationforalllisteddomesticcompanieswas$68.6trillion.Thismeansthatexplosivegrowthwillberequiredforthemarketcapofcryptocurrenciestorivalthemarketcapofcheckingaccountsorstocks.Intheory,theonlycheckonthecryptocurrencymarketcapistheworld’smoneysupply.However,atleastinthenear-term,it’sunlikelythecryptomarketcapexceedsevenafewtrilliondollars.Howcancryptoassetswithlowtradingvolumeshehighmarketcaps?Marketcapitalizationisapopularindicator,butitdoesn’ttellthewholestory.Rankingcryptocurrenciessolelybymarketcapignorescrucialstatisticalinformationandfailstoinforminvestorsaboutpopularity,liquidity,andotherimportantfactors.Investorswhobasetheirdecisionsexclusivelyonmarketcapoftenendupdisappointed.Investorswouldbebetteroffanalyzingthetimeneededforacryptoassettotradeitsmarketcapequivalent.Theruleofthumbisthatifacryptocurrencygeneratestradingvolumethatisequaltoorhigherthanitsmarketcap,itishealthyandstable.Investorscangetinandoutofpositionsquicklyandlockintradesatpreferredprices.Monthlytradingvolumeforsomeofthemorepopularcryptocurrenciesissimilartotheirrespectivemarketcaps.Thisindicatesstabilityandbalancedinterestfrommarketparticipants.Buthowmightacoinwithlowtradingvolumegetahighmarketcap?Itoftenoccurswhenacryptocurrency’ssupplyishigh,buttherearen’tmanycoinsincirculation.Thiscouldbeduetolong-termHODLerswhoaren’tactivelybuyingandselling.Adisadvanteofinvestinginlow-volumecryptoassetsistheirinabilitytosupportbigtrades.Asingletradecouldmovealow-volumecryptocurrencysignificantly.Thismakessuchassetsunattractivetolargeinvestorswhowouldstruggletoexecutemajortradeswithoutexperiencingslippe.Howcanacryptocurrencyartificiallyboostitsmarketcap?Inapreviousanswer,wecoveredthedrawbacksofrelyingonmarketcapwhenmakingcryptocurrencyinvestmentdecisions.Wedemonstratedjusthoweasyitistomanipulatemarketcap.Inrecentyears,thecryptocurrencyspacehasmadestridestowardslegitimacy,butsystemicabuseremains.Oneofthemostcommonwaystheecosystemismanipulatedisviaartificialinflationofprojectmarketcaps.Herearefivepracticesthattokenissuersadopttomanipulatetheirmarketcaps:1.SupplymanipulationCryptomarketcapiscalculatedbymultiplyingthepriceofacoinbyitscirculatingsupply.Thismeansthatbyinfluencingcirculatingsupply,atokenownercanaffectthemarketcapitalizationofhisorherproject.Theeasiestwaytodothatisbybuildingfrequenttokenemissionsintotheprotocol.Otherprojectownersadoptthestrategyofreleasingamassiveinitialissue.Ifanewcryptocurrencycanissueamilliontokensandsellthefirstonefor$1,themarketcapoftheprojectbecomes$1million.SowasthecasewithU.CASH(UCASH),Dentacoin(DCN),andseveralotherprojects.Anotherwaytomanipulatesupplyisbyairdroppingcoinsintouserwallets.2.FaketradingvolumeThisisthemostcommonmeansofmanipulatingacryptocurrency’smarketcap.Overthepastfewyears,severalstudiesheconcludedthatsometokenownerssendfakevolumetoexchangestomaketheirprojectsappearmoreattractivetoinvestors.Highervolumeindicatesgreaterinterestinaprojectandmoreliquidity,whichmeansthatinvestorscanenterandexitpositionsattheirpreferredprices.Atokenwithhigherreportedvolumeisalsomorelikelytobelistedtowardsthetopofanexchange’srankings,whereitwillbemorevisibletoinvestors.ThiscansparkFOMO,or“fearofmissingout.”3.PricemanipulationAnotherwaytomanipulatecryptoassetpricesisviaso-called“pump-and-dump”schemes.Theseschemesaren’talwaysengineeredbytokenowners.Sometimestheperpetratorisaninvestorinterestedinartificiallyboostingthepriceofacoin.Inapump-and-dumpscheme,amarketparticipantsendsahighvolumeofbuyorderstocreatetheimpressionthatthereisinterestinaproject.Thisgeneratesrealinterest,andthepricejumps.Atthatpoint,theinitialbuyerssell–ordump.Unliketraditionalpump-and-dumpschemes,inacryptoassetpump-and-dump,thepricemayfall,butitdoesn’tnecessarilycrash.Afterall,therearesomenaturalbuyers.Justtobesurethatthepricedoesn’tcrash,fraudstersmaydumpinwes.Ratherthansellallatonce,theysellsteadily.Thisresultsina“bottom-fishing”situationwhereotherswonderwhetherthepricedropismerelytemporary.They’remotivatedtobuyandendupsupportingtheprice.Allofthisresultsinanartificialpriceincreasethatsimultaneouslydrivesupmarketcap.Thistypeofpricemanipulationisusuallyappliedtolowmarketcapandlow-volumecryptoassets,although,dependingonthescale,itcanworkinmoredevelopedmarketsaswell.Tolearnmoreaboutpump-and-dumpschemesandtheirapplicationtothecryptocurrencyworld,seethiscomprehensivestudy.4.FakerecommendationsandmisinformationManyprojectspayreviewsitesforpositivereviewsandrecommendations.Anunsuspectingaudiencecanbeeasilymanipulated.Thedisseminationoffalseinformationoftenhappensduring“pumping”phaseswhenthecommunitybehindaprojectendeorstoattractasmanyinvestorsaspossible.Totrickothersintobuyingtheircoin,acommunitymighttryfakenewsstories,fakepartnerships,orevenforgedendorsementsfromprominentpublicfigures.Forexample,agroupcreatedafakeTwitteraccountthatresembledonebelongingtothelateJohnMcAfee.Theaccount’snamewasmadetolookliketherealone,@officialmcafee,onlyitincludedanextra“l”.Thefakeaccountpostedpositivetweetsaboutanaltcoin,GenesisVision(GVT),andsupportedthosestatementsinachatroom.Thetweetwassharedthousandsoftimes,andthepriceofthecoinjumped50%.5.HypeSomeprojectownersusebotsandfakeaccountstogeneratebuzzonsocialmedia.Buzzattractsinvestors.Moreinvestorsmeanahigherpriceandahighermarketcap.Analystshedevelopedmetricstoevaluatewhetheraprojectisbeingunreasonablyhypedonsocialmedia.Oneofthemostpopularindicatorsisthehype-to-activityratio.Itmeasuresthenumberoftweetsaboutacryptoassetpermilliondollarsoftradingvolume.Theratiouses30-dayeresforbothtweetsandtradingvolume.Inmostcases,overhypedprojectsareindeedusingbotsorfakeprofiles.Hypecanalsocomefromtheorganizedeffortsofaproject’scommunity.InvestorsmayjoinforcesonTelegramtohypeaprojectandincreaseitsprice.StudiesheshownthatTelegramandDiscordgroupsarecapableofboostingpricesasmuchas950%.Thatsaid,mostinvestorsareabletoseethesehype-drivenpumpsforwhattheyare.Howcanacryptocurrencyartificiallyinflateitstradingvolume?Faketradingvolumeisoneofcryptocurrency’smostwell-knownproblems.Numerousreportshecomeout(Bitwise,CryptoIntegrity,TheBlock,SylvainRibes,andothers)whichconfirmthatabubblewascreatedbytokenownersandexacerbatedbyexchangesandexchangedatagregators.Studiesconcludethatmorethan80%oftradingvolumeisfake.Thetruthisthatartificiallyinflatingtradingvolumeisprofitableandeasy.Fromaprojectowner’spointofview,inflatingvolumemakestheirprojectmoreappealingtoinvestors.Hightradingvolumeisasignofliquidity,whichallowstraderstoenterandexitpositionsquickly.It’salsoindicativeofstability,orlowvolatility.Highvolumesignalsthatamarketishealthyandworthinvestingin.Forthesamereasons,highertradingvolumeenablesanexchangetochargehigherlistingfees.ItalsogeneratestrafficfromgregatorsandhelpsexchangesattractIEOs.Tradingvolumedoesn’tgrowontrees,butitisrelativelyeasyforprojectownerstomanipulate.Fromthere,thecontionspreadstoexchangesandmarketdatagregators.Whatarecommonwaystofaketradingvolume?Themostcommonmethod,tickerstuffing,isdetailedbyNomicsCEOClayCollinsintheshortvideo,“HowCryptocurrencyExchangesSpamCoinMarketCap(WithFakeVolume).”Anexchangesimplychangesthevolumenumber.It’sthateasy.Atoken’stradingvolumecangrowfrommillionstobillionsinthesecondittakestotypethreezeros.There’snoneedtomodifytradesorcandles.Allonehastodoisadjustthenumber.Thereareotherwaysaswell.Coindeskhasfoundthattherearecompaniesofferingtofakevolumeforafee.TheseoutfitsprogrambotstobuyandsellatokencontinuouslyuntiltradingvolumeissufficientlyinflatedtoearnarankingonCoinMarketCapandotherexchangegregatorsites.Thispracticeisalsoknownas“washtrading”.Mostofthetime,washtradingisengedinbyexchanges,butitcanbedonebytokenownersaswell.Someexchangesencouretheircustomerstowashtradeforthem.Theseexchangescompensatewashtraderswithtokensordiscountedfees.Foraprojectowner,anexchangemightalsooffertocutthelistingfee.Inmanycases,whenanexchangeandaprojectownerconspiretoartificiallyboosttradingvolume,it’sawin-winforbothsides–atleastintheshort-term.Otherexchangeskeepitsimpleandcounteachtradetwice.If,forexample,Bitcoin(BTC)istradedainstEthereum(ETH),theexchangewouldrecordtwotransactions–abuyandasell.HowcanIrecognizefakevolume?Mostexchangegregatorspostdatadirectlyfromtokenprojectsorcryptoexchanges.Oftentimes,thisdatacontainsfakevolume.Mostofthetime,ifyouuseangregator,you’llhetoperformindependentresearchtoverifythereportedinformation.AtNomics,wetakeadifferentapproach.WeprovidevisitorsandAPIuserswithTransparentVolume,theportionoftradingvolumethatcomesfromexchangesthathereceivedanA+,A,orA-TransparencyRating.Thesehighly-ratedexchangesareconsideredtobetransparentbecausetheyheprovidedNomicswithhigh-granularitytradedata,includingfullhistoriesforeachtradingpair.Inotherwords,withtransparentvolume,yougetamuchmorerealisticrepresentationthatexcludeswashtradingandotherformsoftoxicvolume.Foreachcryptoassetlistedonourhomepe,TransparentVolumeislocatedbetweenVolumeandCirculatingSupply.Formostassets,TransparentVolumerangesbetween20%and70%.However,therearesomeassetswithvaluesaslowas5%.Thisgoestoshowthelevelofmanipulationthatexistsinthecryptocurrencymarket.Whatisthetotalcryptomarketcap?Thetotalcryptomarketcapisthesumofthemarketcapsofallactivelytradedcryptocurrencies.Tofindthetotalcryptocurrencymarketcap,visitNomics.com,andlookfortheGlobalMarketCapcard.Itx27;satthetopofthepe,rightunderthetitleTopCryptocurrenciesbyMarketCap.WhichcryptocurrencyshouldIbuy?Thisisacommonquestionandanunderstandableonegiventhattherearethousandsofactivelytradedcryptocurrencies.Thevarietyofinvestmentopportunitiescanresultinanalysisparalysis.Youshouldchooseprojectswithhistory,acleargoal,transparentvolume,anactivecommunity,andongoingdevelopment.Thesecharacteristicsindicateahealthyprojectwithpotential.It’salsoimportanttoconsideryourrisktolerance.Youcouldchooseaprojectthatisalreadylistedandactivelytraded,suchasBitcoin(BTC)orEthereum(ETH),oryoucouldgowithahigh-risk,high-rewardICO.Let’sstartwithlistedandactivelytradedcryptocurrencies.Thesecurrenciesareoftenregardedasmoresecurethannewprojects.Theyhetrackrecordsandenoughtradingvolumetobeconsideredliquid.Ifyouchoosetoinvestinaleadingcoin,followthenewsforregulatorydevelopments,policiesthatmayeaseorpreventmainstreamadoption,andindustryshifts.Ifyouhetheskills,youcanalsoincludetechnicalanalysis.Thatway,you’llheawell-roundedstrategythatminimizesrisk.WhetheryourgoalistoHODLforyearsortospeculateonshort-termpricefluctuations,establishedcryptoassetscanbeanexcellentchoice.ThenthereareinvestorswhodreamofdiscoveringthenextBitcoinorEthereum.Thesefolkstendtolookatpre-launchprojectsandICOswithhighgrowthpotential.Whenconsideringearly-steopportunities,it’simportanttobewareprojectsthatpromiseexorbitantreturns.Manyprojectsthatmakebigpromisesarenotreallydesignedtosucceedintherealworld.They’resolelyfocusedonseparatingnoviceinvestorsfromtheirmoney.Whateveryourrisktolerance,beforemakinganinvestmentdecision,itisessentialtodeterminewhichtypeofcryptoassetyou’reconsidering.Therearefivemaincategories:UtilitytokensAlsoknownasapptokens,utilitytokensheanapplicationandvalueontheirissuingplatforms.Investorswhopurchaseutilitytokensbelieveintheprojectwithwhichthey’reassociatedandwanttobuyinbeforethepricegoesup.Bearinmindthatthetotalsupplyofutilitytokensisusuallyfixed.SecuritytokensSometimesreferredtoas“digitalshares”,securityorequitytokensaretokenizedslicesofsecuritiesinwhichholdersheownershiprights.Securitytokenscanalsoprovideholderswiththerighttoreceivedividends.Formoreonsecuritytokens,checkoutourthree-partaudiodocumentary,TokenizetheWorld.AssettokensAssettokensaredigitalrepresentationsofphysicalassetslikegoldandsilver.They’repopularbecausetheyprovideinvestorswithanWashindani: Market Crypto Caps - Prices, Highlights All-Time, ChartseasywaytWashindani: Market Crypto Caps - Prices, Highlights All-Time, Chartsobuypreciousmetalsandothercommodities.Thepriceofanassettokenistiedtothepriceofanunderlyingphysicalasset.CurrenciesCurrenciesarethemostcommoncryptoassettype.Astheirnamesuggests,theyserveasaformofpayment.Bitcoin(BTC)isthemostprominentexample.RewardtokensRewardtokenshenovalueontheopenmarket.They’resimplyusedtogamifyplatformengementbyrewardinguseorloyalty.Mostrewardtokenscanonlybespentontheirissuingplatform.We’vecoveredthetypesoftokensaprojectcanissue.Nowlet’scoversometipsthatwillmakeyouabettercryptoinvestor.Toincreaseyouroddsofchoosingsoundcryptoassetprojects,considereachopportunityintermsofthefollowingcharacteristics:1.PhilosophyandstatedgoalsInmostcases,ICOsareideasthatneedmoneytoberealized.AnICOisrarelyafunctioningproduct.Ifyoudecidetoinvestinanearly-steproject,understandthatyou’resupportingaconcept,notsomethingthathasbeenproven.ThisisnottosaythatinvestinginanICOisfoolhardy.Injustfivedays,theEOS(EOS)ICOraisedover\$180millionwithoutaworkingproduct.Fromthere,thepriceofthetokenskyrocketedmorethan450%.WhatthismeansisthatyoushouldjudgeanICOonitsfundamentalsratherthanitstrackrecordintherealworld.Thinkaboutthephilosophyonwhichtheprojectisbuiltaswellasitsstatedgoals.Bitcoinwaslaunchedasanalternativetotraditionalmoney.Ethereumwasdesignedtobeaworldcomputerfordecentralizedapplications.Themostimportantfactorwhenselectingacryptoassetprojectisthephilosophyandstatedgoalsofitsfounder(s)orteam.Thegoalshouldbeambitiousbutrealistic.Thecryptocurrencyspaceisfilledwithprojectsthatpromisetotransformtheworldforthebetter,butmostattemptstoreorganizetheglobalfinancialsystemorabolishpovertyorhungerwillfail.Itisvitaltodistinguishhypefromanideawithareal-worldusecase.Projectsthatareambitiousintermsofthetechnologythey’redevelopingorwhichhopetorefineanexistingconcepthethebestchancesofdisruptingthestatusquoandmeetingwithsuccess.Thatsaid,it’sworthkeepinginmindthatthelikelihoodoffindingaunicorninthecrowdedcryptocurrencyspaceisnotashighasitoncewas.Lookforprojectsthatseektoaddfunctionality,accelerateprocesses,orotherwiseaddressaspecificpainpoint.Cryptoassetprojectswithclearlydefinedgoalsarethemostlikelytogeneratelong-termvalue.It’salsoimportanttoconsiderthetechnologythatpowersaproject.Launchingatokenrequiresablockchain.ManyofferingslaunchonEthereum(ETH)orBinanceSmartChain(BNB).OtherprojectslikeCardano(ADA)createanewblockchainfromscratch.Startingfromsquareonemayyieldterrificlong-termresults,buttheprocessisslow,costly,anddifficulttoexecute.2.AwhitepaperUnfortunately,thereareprojectsintheCryptospherethataredesignedtoscamwould-beinvestorsoutoftheirmoney.Thosewhodon’tdotheirownresearchriskbecomingvictims.IfyoushyawayfromestablishedcoinslikeBitcoinandEthereumandforprojectsthatflyundertheradar,alwaysbesuretoreadthewhitepaper.Seriousprojectswritedetailedwhitepapers.Tokenswithvuewhitepapersorwhitepapersthathebeencopiedandpastedfromotherprojectsshouldbeoided.Agoodwhitepaperanswersallofyourquestions.Itcoverstheprojectgoal,thefounder’sbackground,thedevelopmentteam,andtheroadmap.Agoodwhitepaperalsocoversthelegalframeworkthatexistsbetweenthedevelopmentteamandinvestors.Additionally,itshouldanswerquestionsrelatedtotokendistributionsuchaswhenandhowholdersreceivetokensandtheamountoffundingrequiredforeachphaseofthedistributionprocess.Aboveall,aproject’swhitepapershouldexplainwhyitneedsatoken.Ifthatquestiongoesunanswered,stayaway.Theremustbeareasonforissuingatoken.Ifthereasonisn’tclear,thentheprojectmaylackareal-worldusecase.It’salsoimportanttoknowhowraisedfundswillbestored.Iffundsarenotsecuredbysmartcontractoranescrowaccount,thenyourmoneywillbeatrisk.Beyondthat,it’swisetofamiliarizeyourselfwiththecompanybehindthecoin.Doestheteamincludeexperiencedsoftwaredevelopers?DoestheCEOheatrackrecord?Whoaretheproject’sadvisors?Iftheadvisoryteamseemstoogoodtobetrue,itmaybe.ShadyprojectshefalselylistedA-listadvisors.Ifyouseethataprominentfigurehassignedontoadvise,researchwhetherthatpersonisreallyassociatedwiththeproject.Anyinformationregardingtheteamandadvisorsshouldbefrontandcenterinawhitepaper.Ifit’snot,regarditasaredfl.Ifyouareconsideringinvestinginanestablishedcoin,checkwhetherithasstayedtruetoitswhitepaperandroadmap.Ifithasn’t,youmightwanttosteerclear.3.TradinghistoryForestablished,activelytradedcryptocurrencies,it’simportanttoconsidertradinghistory.EvenifyouintendtoHODL,it’sbesttochooseacryptocurrencythatisactivelytradedandliquid.Wheninvestorsknowtheycanenterandexitpositionswithoutslippe,they’remorelikelytoinvest.Thisbodeswellforpriceappreciation.Tooidfaketradingvolume,usemetricslikeTransparentVolume.It’salsoimportanttoanalyzepricemovement.Cryptoassetsthatconstantlyexperiencewildpricefluctuationsmaybetargetsofpump-and-dumpschemesorothermanipulativetradingpractices.4.StrongcommunityLookforcryptoassetprojectswithsupportive,activecommunities.MostprojectshepublicTelegramorSlackchannelswhereyoucancommunicatewithcommunityorteammembers.There’susuallyinformationonRedditandTwitteraswell.Wheninteractingwithmembersofacryptocommunity,besuretotakeeverythingwithagrainofsalt.Opinionsmaybebiasedandfewcommunitymemberswillhethetechnicalexpertisetoproperlyjudgeorcommunicateaproject’sprosandcons.Keepinmindthatsomeprojects,eventhosewithlargecommunities,relyonpaidPRtoboostinvestorinterest.Takehypeforwhatitis,andalwaysdoyourownresearch.It’salsoworthnotingthatprojectswithcleargoalsandreal-worldusecasestendtomarketthemselvestheleast.Theygiveinterviews,periodicallyreleaseannouncements,andmaintainasocialmediapresence,buttheydon’tpaypeopletohype.5.AcompetitiveedgePayattentiontothecompetition.Youmayhefoundaprojectthatpromisestocreatereal-worldvalueforthousandsormillionsofusers,butwhatifthere’sanotherteamwiththesamegoalinmind?Inacrowdedmarket,theslightestedgeintimetomarketoruserexperiencecanmakeahugedifference.WhenevaluatinganICO,considerwhereaprojectisinitsdevelopment.Sometokenslaunchwithlittlemorethanawhitepaperandaprayer.Othershebetaversionsonthemarketandareactivelycollectinguserfeedback.Inrarecases,thereisaworkingproduct.Thoughitcanbeprofitabletoinvestinveryearly-steICOs,it’ssafesttochooseaprojectthateitherhasaworkingproductorisclosetoreleasingone.Aworkingproductmeansthatdevelopmentisatanadvancedste,whichsignalsthattheideasbehindtheprojecthebeentested,ifnotinthewildthenundercircumstancesthatcloselymimictherealworld.Ifthereisacompetitorproject,considerwheretheyareintheirdevelopment.Ifthey’reclosertoaworkingproduct,theycouldseizeasignificantportionofthemarketwhileclaimingfirst-moveradvante.Anotherthingtolookforiswhetheraprojectisbackedbyventurecapital.IfVCssupportaproject,itsignalsthatithasasoundbusinessphilosophy,goodleadership,andareal-worldapplication.Venturecapitalcanalsobringcredibilitytoaproject,whichattractsotherinvestorsanddrivesuptheprice.Don’tforgettocheckwhethertopVCsbackthecompetition.Iftheydo,itmayindicatethatacompetitorislessrisky,possiblybecauseithasastrongerbusinessplanoramoreexperiencedCEOordevteam.Whenevaluatingacryptoasset,it’svitaltounderstandwhattypeofprojectitis.Welistedfivecategories:utilitytokens,securitytokens,assettokens,currencies,andrewardtokens.Wethendiscussedthecharacteristicsofgoodcryptoassetprojects:asoundbusinessphilosophy,adetailedwhitepaper,liquidity(ifit’sanestablished,activelytradedcoin),anactivecommunity,andacompetitiveedge.Intheend,ifacryptoassetprojectwantsyourmoney,it’sonthemtomakethecase.Aprojectthat’sworthyourtimeandmoneywillbetransparentabouttheirgoalsandoperations.Whatdoes‘Nomics’mean?Nomics-asineconomics.ThewordcomesfromAncientGreek:"nomics”,orνόμος(nómos,“law”).Ithaslongbeenusedincombinationwithotherwordstoformtermsthatdescribethelawsorrulesofadiscipline(e.g.Reanomics,ergonomics,genomics).HowdoIlistacryptoassetonNomics.com?Justfilloutthetypeform.AdvertiseHereMadewith❤inMinnesotaandMassachusettsMarketActivityAssetsExchangesCurrencyConverterWatchlistProductsAdvertisePricingMarketDataAPIWhiteLabelAPIforExchangesServicesContactSalesFeatureRequestStatusPeProductUpdatesResourcesAPIDocsBlogNewsletterForumsExchangeIntegrationVerifiedExchangeProgramMarketDataQuizNomicsx27;WebinarWebinarArchiveCompanyAboutManifestoCareersContactContactUsAPIKey©2023Nomics™|AllRightsReservedUpdatetrackingpreferencesTerms|Privacy