At the time of publication, the cost of a single Bitcoin (BTC) is $ 47,277, while the cost of Dogecoin (DOGE) is around $ 0.068. If you’re new to cryptocurrencies or markets, consider getting started: Hi, DOGE is cheaper than Bitcoin, and if it’s gained enough momentum, you’ll probably catch up with BTC and grow by over $ 20,000. However, this line of thinking is illogical. Why? Market value and supply of assets.
Market value is the total dollar value of an asset’s traded offer. It changes when the value of this asset rises and falls. Cryptocurrency sites such as CoinMarketCap rank each cryptocurrency by market value. Bitcoin is a longtime leader in this category, with a market value of approximately $ 879 billion dollars at the time of publication.
Market value takes into account the current supply of each asset. The transfer is the amount of an asset that moves freely in the market. Multiply the traded bid by the price of the asset and you get the market value of it.
Assets with a large number of trades are often traded at lower prices in dollars per coin or token. BTC currently has a relatively small amount in circulation – around 18.6 million coins, and although this number is slowly increasing depending on mining, the maximum offer is still relatively small at 21 million coins. Meanwhile, according to data from CoinMarketCap, Dogecoin has around 128.3 billion traders.
With DOGE trading, the market value would be around $ 800 billion if each coin were valued at around $ 6.23. Meanwhile, Bitcoin is valued at more than $ 40,000 per coin with the same market value due to the lower amount in circulation.
To even reach $ 1500 per DOGE, the asset will require the market value of the asset to be around $ 192.4 trillion. At the time of publication, the market value of the entire cryptocurrency market is around $ 1.46 trillion.
As a general rule, assets with a lower offer turnover ratio may have a higher price per currency than a large supply of assets. For example, YFI Yearn.finance has a very small amount in circulation of only 36,635. The YFI has grown from around $ 900 in July 2020 to $ 40,000 in September 2020. Many other components contribute to price increases, but usually, if the asset has a relatively large amount in circulation, the price of each coin cannot be directly compared to the price of the coins. . By a smaller margin.
Cryptoactive often also has a maximum margin programmed in the code. The availability available for each asset is constantly growing through various forms of blockchain network validation – ie mining or gaming – until it reaches maximum access. Prices can drop when coins or tokens leak into their respective circulation supplies, as auditors tend to sell their online support bonuses to cover the cost of doing business.
What is the difference between total bid and maximum bid? “Total supply indicates the number of coins or tokens that are currently in circulation or locked in one way or another,” Enrique Erhard wrote in an article for Binance Academy, adding: “This is the sum of all existing coins that have been mined. (or released).) Minus Including the total number of coins burned or destroyed.
Meanwhile, the maximum bid is the entire fixed width of the asset, or more precisely the total number of coins or tokens that have been or can be generated. This means that when the maximum supply is reached, it will not be possible to produce coins or tokens.
Understanding the concept of market value related to the price of any asset can be important so that you can consider the crypto space more realistically. You can take a look at the price of a single Bitcoin and find it prohibitively expensive by immediately turning your attention to something cheaper.
Much of the information goes to investing in cryptocurrencies. Assets vary in condition of use, adoption, potential return and associated risk, as well as other factors. However, assessing each asset in light of its specific market value, price and offer can help assess the market.