What is Market Cap in Cryptocurrency?

By Julia Cook
Published Dec 1, 2022 and Updated Mar 20th, 2023

Cryptocurrency market capitalization (market cap) refers to the total value of cryptocurrency that is available in the market.

Cryptocurrency market cap is calculated by taking the total amount of a cryptocurrency that has been mined and multiplying it by the value of each unit. For instance, on July 13, 2022, there were around 19,092,550 Bitcoin (BTC) in circulation. The price of a single BTC was around $19,687.50 USD, therefore the BTC market cap would be calculated as 19,092,550 x $19,687 = $375,884,578,125. The total cryptocurrency market cap would then apply this calculation to each cryptocurrency and then add each total together. However, each exchange will give a slightly different cryptocurrency market cap because they choose to list different altcoins to each other.

For instance, some exchange platforms will list certain specifications for a coin to be approved for listing, sch as the associated platform being active, approved by the SEC, proven to not be a scam and worth above a certain amount, among other. At the very least, all exchange platforms will list the most significant crypto, such as BTC, Ether (ETH), USD Coin (USDT), Ethereum Classic (ETC), USD Coin (USDC), BNB, Binance USD (BUSD) and Ripple (XRP.)

Coin market cap values are important because hey allow investors to perceive the real value of a cryptocurrency and percentage of the total market cap that it occupies vis-à-vis the other cryptocurrencies. An illustration of this can be found on CoinMarketCap. On July 13, 2022, BTC had a market dominance of 42.7%, while ETC had a dominance of 14.7%. It is because BTC is the first cryptocurrency and has such a significant claim over the cryptocurrency market that it is used as the cryptocurrency standard when evaluating an altcoin in cryptocurrency rather than fiat currency.