At the time of publication, the cost of a Bitcoin (BTC) is $ 47,277, while the cost of Dogecoin (DOGE) is around $ 0.068. If you’re new to cryptocurrencies or markets, think first: Hi, DOGE is cheaper than Bitcoin, and if it’s gained enough momentum, it could possibly catch up with BTC and grow by over $ 20,000 as well. However, this mindset is illogical. Why? Market value and supply of assets.

Market value is the total dollar value of a supply of current assets. It changes when the value of this asset rises and falls. Cryptocurrency sites like CoinMarketCap rate each cryptocurrency by market value. Bitcoin is a longtime leader in this category, with a market value of approximately $ 879 billion 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 asset price, and you will get the market value of it.

Assets with many outstanding offers are often quoted at lower dollar rates 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 with 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.

In general, assets with a lower turnover rate for the offer may have a higher price per currency than a large offer of assets. For example, Yearn.finance’s YFI 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 in general, if an asset has a relatively large amount in circulation, the price of each currency cannot be directly compared to the price of the currencies. Mineral. By a smaller margin.

Cryptoactive often also have a maximum margin programmed in the code. The availability available for each asset grows continuously through various forms of blockchain network validation – such as mining or caching – until it reaches maximum supply. Prices can drop when coins or tokens leak into their respective circulation supplies, as auditors tend to sell online support bonuses to cover the cost of doing business.

What is the difference between total bid and maximum bid? “The total supply indicates the number of coins or tokens that are currently in circulation or have been locked in some way,” Enrique Erhard wrote in an article for Binance Academy, adding: “This is the sum of the coins they contain that already have been recovered (or released).) Minus the total number of coins burned or destroyed.

Meanwhile, the maximum supply is the entire inventory of the asset, or more specifically 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 look at the price of a Bitcoin and find the more expensive one, and immediately turn your attention to something cheaper.

Much of the information goes into 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.

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