Why does market cap matter in crypto

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Since the number of mined cryptos and market price keeps cryptos, we get the total crypto market cap.

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Why is Market Cap IMPORTANT In Crypto? (BEST Explanation in 3 minutes)
Herein lies the problem. Market cap is about price, not value. It does not reflect the value of the company or crypto asset you're investing in. It affects crypto prices by influencing investor sentiment and perceived value, as higher market cap can indicate higher demand and potential. Cryptocurrencies with higher market caps often have greater liquidity and higher trading volume, making them easier to buy and sell via.

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This compensation may impact how and where listings appear. If you can generate a more holistic view of your assets, you're more likely to find yourself in a position of power in trading. Article Sources. Securities and Exchange Commission. This is especially prevalent in cryptocurrency where new tokens or coins are issued or minted frequently.