Market Cap

Definition

Market capitalization multiplies the last price by circulating supply. It is a sizing heuristic researchers use to compare relative scale across assets, not a measure of intrinsic worth or future returns.

Market cap helps you place an asset in a band: micro, mid, large. Those bands change which risks dominate — liquidity and unlocks for smaller names, narrative leadership and fee quality for larger ones — but the number itself is not a thesis.

Because market cap uses circulating supply, it can look “cheap” next to FDV when float is tiny. Always read the two together and ask what supply path closes the gap.

Peer comps work best inside the same sector and similar float regimes. A market-cap rank scraped from a leaderboard without liquidity or token-capture context is entertainment. Exit capacity is part of the concept, not a trader-only footnote.

Why researchers care

• Compare like-with-like narrative peers by market cap band.
• Ignore market cap without float and liquidity context.
• Rank alone is not a thesis.
• Circulating methodology differences can warp comps.

How to use it in research

• Bucket candidates into market-cap bands before applying the same unlock checklist.
• Reject a “undervalued vs BTC” take that ignores sector and float differences.
• Recalculate market cap after a major unlock expands circulating supply.

Common mistakes

• Treating market cap as fair value.
• Comparing FDV of one asset to market cap of another casually.
• Assuming higher market cap means lower risk in absolute terms.