What is Market cap?

Market capitalization is the price of one unit multiplied by the number of units in circulation. It is the standard way to compare the size of crypto assets, and the ranking by market cap is the first thing most people see on any data site. Bitcoin's market cap is the price of one bitcoin times roughly twenty million coins.

The number has known weaknesses. Circulating supply is an estimate for many tokens, and it can exclude large locked or team-held balances that will enter the market later; the fully diluted valuation, price times total supply, shows that gap. Price is the last trade, which for thin tokens can be a single small swap. A tiny token with a huge printed market cap and no liquidity is a common sight.

Market cap is also not money in a market. Doubling a token's price doubles its market cap without a single new dollar arriving, and selling a large holding into thin liquidity can erase a market cap that existed only on paper. It is a size ranking, useful for comparison and useless as an estimate of what could be withdrawn.

For a portfolio the relevant figure is your position's value at a price the market can bear, not the asset's market cap. A tracker uses market cap mostly as a sanity check on pricing: a token whose printed price implies an absurd cap is usually a token with no market, and it belongs in the dust filter rather than the total.

Rankings by market cap move for reasons that have nothing to do with a project. A large unlock of team tokens raises circulating supply and market cap overnight; a rebrand or a token migration can make an asset briefly disappear from the list. Treat the ranking as a rough map of size and attention, and read supply schedules before treating a cap as a settled fact.