Actually, the crypto currency market cap or crypto currency market capitalization is a very useful metric to know the genuine worth of crypto currency. If you go to coinmarketcap, you will view the coins that are ranked in a descending order of their market cap. First of all, you should know how the market cap works and also how can you utilize it to create your own investment decisions. Actually, the market cap of a crypto currency is calculated by using this formula:
Market cap= Total circulating supply * price of each coin.
Moreover, it is a product of the circulating supply of coins as well as a price of each coin.
Different kinds of market cap in crypto currencies
In general, the crypto currencies can be categorized into small cap, mid cap and large cap. The large cap crypto currencies have a massive market cap and such investment is safe to build. The companies with over $10 billion market cap are classified as large cap companies. As per estimation, only ripple, bitcoin and Ethereum are classified as large cap cryptos.
The mid cap crypto currencies have a minimal market cap, but quite risky than the large cap cryptos. However, the cryptos with market caps between $1 billion and $10 billion market cap are usually mid cap. At last, the small cap crypto currencies have minimal market cap as well as greater risk; because the case of failure is much greater. The companies with market cap under $1 billion are small cap.