What is the crypto market cap?
Axel is a crypto analyst and is deeply involved in the world of crypto and blockchain
Axel is a crypto analyst and is deeply involved in the world of crypto and blockchain
One of the terms you often come across in crypto is the market cap. But what does it actually mean?
Don't worry: you don't need to be a financial expert to understand it. In this article we explain simply what the crypto market cap is, why it matters and what to watch out for!
What is the market cap?
The market cap of a cryptocurrency is the total value of all coins currently in circulation.
You calculate the market cap with this simple formula:
Market cap = Price per coin × Number of coins in circulation
So: does one Bitcoin cost €90,000, and are there approximately 19.8 million Bitcoin in circulation? Then the market cap is around €1.78 trillion.
The market cap therefore gives an indication of how large a crypto project is.
Why is the crypto market cap important?
Many people only look at the price of a coin. But a low price does not automatically mean that a crypto is "cheap".
A coin worth €0.01 can still have a gigantic market cap if there are trillions of coins in existence. Take Cardano vs. Litecoin as an example: one Litecoin costs much more than one Cardano token, but Cardano has a higher market cap due to the large number of tokens in circulation — making it a larger project.
That is why investors often use the market cap to compare cryptocurrencies more effectively.
Market cap in stocks vs. crypto
The term market cap also appears in the traditional financial world, for regular companies and shares. The calculation is the same: share price × number of outstanding shares = market value of the company.
With shares, the total number of shares is almost fixed, which means the market cap gives a fairly stable picture of the company's value.
In crypto the principle works the same, but there is an important difference: the supply can change. New coins are added through mining, coins can be burned (burning), and large quantities may still be gradually released. As a result, the crypto market cap moves faster than that of shares.
Circulating supply, total supply and max supply
To fully understand the market cap, it is useful to know which "number of coins" is actually meant. There are three variants:
Circulating supply: the number of coins currently in circulation that can be freely traded. This is the figure used for calculating the market cap.
Total supply: all coins that have ever been created, including coins that are temporarily locked or not yet available to the market.
Max supply: the maximum number of coins that will ever exist. For Bitcoin that is 21 million. Not every crypto has a max supply — some coins have unlimited issuance.
Why does this matter? Suppose a project currently has 10 million coins in circulation, but there are still 90 million coins ready to be released later. The market cap may look small on paper, while the potential supply is much larger. That can influence the price.
Large, mid and small cap cryptos
Cryptos are often classified by market cap. As a guideline, many platforms use the following breakdown:
Large cap crypto (> $10 billion): These are the largest cryptocurrencies, such as Bitcoin and Ethereum. These projects usually have existed longer and often have more users, trading volume and name recognition.
Mid cap crypto ($1 billion – $10 billion): These are medium-sized projects that are often still in heavy development. They may have more growth potential, but usually also carry more risk.
Small cap crypto (< $1 billion): These are smaller projects with a relatively low market cap. These cryptos can sometimes rise sharply, but also fall steeply. Prices are often more sensitive to news, hype and market sentiment.
Please note: the boundaries between these categories are not officially established and may differ per platform or source.
What is the total crypto market cap?
In addition to the market cap of individual coins, there is also a total crypto market cap. That is the combined value of all cryptocurrencies together.
Many investors use this total market cap to see how the crypto market is developing as a whole — is the market growing, or shrinking?
The total crypto market cap reached the $3 trillion mark for the first time in 2021. After a sharp correction in 2022 and 2023, the market recovered strongly in 2024–2025, partly due to the approval of Bitcoin spot ETFs and growing institutional adoption. The total market value fluctuates daily — current figures can be found on CoinMarketCap or CoinGecko.
Difference between market cap and fully diluted valuation (FDV)
Sometimes, alongside market cap, you also come across the term fully diluted valuation, often abbreviated as FDV.
The difference:
- Market cap only looks at coins currently in circulation.
- FDV looks at the value if all coins were ever to become available, including coins that have not yet been issued.
A large gap between market cap and FDV can be a signal to do further research. It means that many new coins will be entering the market in the future, which may affect price development.
What is Bitcoin dominance?
When you look at the total crypto market cap, one thing stands out: Bitcoin makes up a large portion of it. The percentage that Bitcoin represents of the total market is called Bitcoin dominance.
Is Bitcoin dominance high? Then relatively more capital is flowing towards Bitcoin compared to other cryptos. Is it low? Then investors are more spread across other coins, also known as altcoins. A falling Bitcoin dominance is often associated in the crypto world with a so-called "altcoin season", where smaller coins rise faster than Bitcoin.
Bitcoin dominance is used by many people in the crypto world as a kind of sentiment indicator for the market. But like market cap, it is one data point — not a guarantee or prediction.
Why does the market cap change continuously?
The crypto market cap changes constantly because:
- the price of crypto moves
- new coins are added through mining
- coins are burned (burning)
- the supply changes
As a result, the total value of a project can rise or fall rapidly.
What does market cap tell you — and what doesn't it?
The market cap can help you better understand cryptos, but it does not tell the whole story. There are a few important limitations to be aware of:
Sleeping wallets: A portion of the coins in the circulating supply have not moved in years and are stored in so-called sleeping wallets. These do count towards the market cap, but are barely tradeable in practice. The actual "active" market is therefore often smaller than the market cap suggests.
Market cap ≠ money in the market: The market cap does not reflect the actual capital inflow into the market. One large transaction can move the price — and therefore the market cap — significantly, without an equivalent amount of capital having flowed in. The total increase in value on paper can therefore be greater than the amount that was actually invested.
Low liquidity can mislead: A small cap coin with little trading activity can appear to have a high market cap if the price is artificially high due to a small number of transactions. Therefore always look at trading volume as well.
Trading volume as an additional check: A high market cap combined with low daily trading volume is a warning signal. It may mean there is little interest from genuine buyers and sellers, making the price vulnerable to sharp swings.
A high market cap does not automatically mean a project is safe or successful. And conversely: a low market cap does not automatically mean a coin has a lot of growth potential.
It remains important to do your own research into:
- the project behind the coin
- the purpose of the crypto
- the team and the technology
- real-world usage
- trading volume and liquidity
- the risks
Is a larger market cap safer?
A larger market cap is generally seen as more stable than a small market cap. Large projects typically have more liquidity, more users and less extreme price swings.
But important to remember: the crypto market remains volatile. Even large cryptos can rise or fall sharply in value. A high market cap is no guarantee of safety or returns.
Where do you find the market cap of a crypto?
You don't need to calculate the market cap of a cryptocurrency yourself. Platforms such as CoinMarketCap and CoinGecko continuously track this data. You'll find market capitalisation, supply variants, trading volume and price history for thousands of cryptos.
Do you trade via BLOX? Then you can see the current rate and market information per crypto directly in the app, without needing to visit an external platform.
Frequently asked questions about crypto market cap
The price is what one coin costs. The market cap is the total value of all coins combined. A coin can have a low price but still have an enormous market cap, if there are billions of coins in circulation.
Bitcoin (BTC) has by far the largest market cap, followed by Ethereum (ETH). The exact order shifts, but these two have been at the top for years. Current rankings can be found on CoinMarketCap.
That depends on your strategy. Large caps (>$10bn) generally offer more stability; small caps (<$1bn) can grow faster but are also riskier. There is no universal threshold for "good" — it always depends on your personal risk profile and goals.
Multiply the current price of the coin by the number of coins in the circulating supply. Example: coin costs €2.00 and there are 500 million coins in circulation → market cap = €1 billion.
A rising total market cap means the combined value of all cryptocurrencies is increasing. This can be due to rising prices, new coins entering the market, or greater interest from investors. It is often seen as a positive market signal, but says nothing about individual projects.
Market cap only looks at coins currently in circulation. FDV (fully diluted valuation) calculates the value as if all coins that will ever be created are already available. A large difference between the two can indicate that many more coins are yet to enter the market.
Conclusion
The market cap of a cryptocurrency shows how much a crypto project is currently worth. It helps you compare cryptos more effectively, but it is never the only factor to consider.
Also take into account the limitations: sleeping wallets, low liquidity and the ratio between market cap and FDV can distort the picture. Always combine the market cap with other information such as supply variants, trading volume and the quality of the project itself.
Ready to discover crypto? Download BLOX and buy, sell and store crypto easily in one clear app.
Only invest what you are willing to lose
A piece of advice you read everywhere, but incredibly important: only invest what you are willing to lose. Crypto prices are highly volatile. You can make a lot of money, but you can also lose it.
Do you want to buy crypto? Make sure you do your own research. Read news articles. Look at technical analyses. Discover how coins work. And who knows — you might even convince your family members at the next Christmas dinner!