KuCoin is a secure and safe trading forum to buy and sell cryptocurrencies or digital assets. Though there are other crypto exchanges, the services KUCoin provides are outstanding. As more than 20 million users are associated with KuCoin exchange and speak different languages, KuCoin offers its multi- language customer services so that the language barrier is abolished. Furthermore, it has established 23 local communities in Europe, Southeast Asia, and other regions offering remarkable services. Now let’s see about the term Market Cap.
Definition Of Market Cap
Market cap is used as a benchmark to measure the popularity of cryptocurrencies. So is it similar to the stock exchange? Crypto Market Cap is somewhat close to the stock market but has its individuality. The contrast between Crypto market Cap and Stock Market is that the stock market refers to the whole market worth of all marvellous agency quota. The market cap of a cryptocurrency is depended by the current price multiplied by the circulating supply. For example, the Bitcoin price is 23,832.30USD. This price will be multiplied by the number of coins circulated to calculate the market cap. Similarly, the ETH/USDT market price will be determined.
Categories In Which Market Caps Are Being Divided
There are three categories into which one can divide the market caps.
Large Cap: Large-cap cryptocurrencies are generally considered to be safe crypto investments. Why is it safe? So, investing in coins with large market capitalization is usually a stable plan.
Mid-cap: Mid Cap is another more volatile crypto but has a lot more growth potential than large-cap cryptocurrencies.
Small-cap: Small-cap is the third category into which market-cap can be divided. These cryptocurrencies are often highly volatile and considered a hazardous investment, sometimes with a lot of potential (short-term) growth. However, they may also crash in no time.
Let’s Have A Look At The Pros And Cons Of Market Cap
Though there are numerous benefits, few include that it is the easiest and most widely-used method of valuing a company. Furthermore, it aids in understanding the size of one company relative to another and helps create a well-balanced portfolio. But as everything has drawbacks also, the market cap is no exception. The disadvantages include that it does not consider a company’s debt load. Therefore, a potential buyer, who values the company using a market cap, might overlook the cost involved in servicing the debt burden.
Few Questions Arise About Market Cap
Apart from the knowledge mentioned earlier, some questions still arise in mind. One question that arises is what are the Altcoin Market Caps? Several Bitcoin alternatives are referred to as “altcoins.” There are many Altcoin exchanges which trade Altcoin. Altcoin market cap is the same as Bitcoin, except for altcoins. One of the analytical queries is, therefore, can Market Caps be manipulated? Yes, by influencing the prices, market caps can exploit market cap.
Thus Market cap can be a valuable tool for an investor who is watching stocks closely and evaluating potential investments. So users should see all the things before investing. And selecting the coins to support the KUCoin exchange is there, providing a fabulous service.