Cryptocurrency Market Cap – Lex Exchange Review for Q3 2019
- Crypto market cap: why does it matter?
- Bitcoin market cap
- Ethereum market cap
- Litecoin market cap
- Dash market cap
- Monero market cap
- Bitcoin Cash market cap
Market capitalization, or market cap, is the metric used to evaluate the size of a company and the value of its shares. If you’re new to trading crypto, take note: this is a crucial figure to pay attention to as you learn how to develop your crypto trading strategy. Market cap is calculated by multiplying the number of circulating shares of a company by the current price of one share. If a company has 1 million shares, and the price of one share is US $1,000, the market cap of the company would be US $1 billion.
Companies trading on the cryptocurrency market can also be evaluated by using the same formula. The crypto market capitalization reflects when the cryptocurrency market goes up and when it goes down. Throughout almost the whole of 2013, the crypto market capitalization was stable at US $1 billion, but then started to grow swiftly during October of that year. By December, it had reached the mark of US $15 billion.
That was the first significant bull run of the market. Four years later, in the first week of 2018, the total cryptocurrency market cap was a mindblowing US $829 billion. This was followed by a bear market throughout most of 2018, from which the market is now recovering. Currently, the cryptocurrency market capitalization is up from US $100 billion to more than US $260 billion.
Crypto market cap: why does it matter?
Traditionally, when it comes to the evaluation of companies by their market capitalization, they can be divided into large-cap, mid-cap, and small-cap. Large-cap companies are those which have a market capitalization above US $10 billion. By looking closely at the cryptocurrency cap of the market, we can also distinguish large-cap, mid-cap, and small-cap cryptocurrencies. Cryptocurrencies have to reach a US $10 billion bar to be termed “large-cap”.
Currently, only Bitcoin (US $180 billion), Ethereum (US $19 billion), and Ripple (US $11 billion) can be considered as large-capitalization cryptocurrencies. Mid-cap cryptocurrencies are those between US $10 billion and US $1 billion, and at the moment, 11 cryptocurrencies are classified as mid-cap. All other cryptocurrencies are small-cap. Of course, this classification is not strict, as the crypto market capitalization value is susceptible to any changes in the market. It is unlikely that a giant like Bitcoin could fall to mid-cap levels; however, there is more potential for altcoins to experience upwards growth: Dash might grow to US $1 billion and become a mid-cap cryptocurrency.
In general, this classification can be helpful for traders and investors to understand the opportunities and risks associated with each cryptocurrency. Large-cap assets are traditionally safer investments. However, the chance for high profits is lower since these cryptocurrencies are often already mature and less likely to experience further significant growth. Still, they have more room for growth than traditional large-cap shares.
Small-cap cryptocurrencies are extremely sensitive to any fluctuations in the market and are therefore considered a riskier investment. On the other hand, they have much more potential to grow and can give more significant returns than large-cap and mid-cap cryptos.
Now let’s take a look at how the crypto market cap has been changing recently for some of the most popular cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Dash (DASH), Monero (XMR) and Bitcoin Cash (BCH).
Bitcoin market cap
The end of June 2019 saw a significant event for the whole cryptocurrency industry. Bitcoin set a new 15-month record high price on the mark of US $11,350. The last time BTC had been traded for anything near this price was in March 2018, just before the crypto Winter hit. A those prices, Bitcoin made up 60% of the total capitalization of the crypto market. The last time this could be said of Bitcoin was 2017. Now, the total crypto market cap stands at around US $260 billion and Bitcoin is responsible for around 68% of this sum. (Dig into what contributed to this rally in our blog post on the topic.)
This dominance was grounds for American crypto analyst and influencer Max Keiser to propose that Bitcoin could soon kick many altcoins out of the market. Currently, the price of one Bitcoin is higher than the price of all altcoins combined. Also, Bitcoin showed better results in terms of growth at the beginning of August 2019 than any other major cryptocurrency. As of publishing time, Bitcoin is being traded around US $10,100 and the Bitcoin market cap is around US $187 billion.
In spite of Bitcoin’s strength, however, Keiser’s prediction has not yet come true. Some altcoins have also increased their share: for example, Chainlink (LINK) and Tezos (XTZ) both grew from around 0.2% to 0.3% in the last two months. In light of this, it is far too early to make predictions about the stagnation of altcoins in relation to Bitcoin.
Ethereum market cap
Ethereum is another large-cap cryptocurrency. It is firmly seated in second place after Bitcoin, with a current crypto cap of around US $19 billion. Ethereum is also notable for its staggering growth in 2017’s bull market: from US $8.24 on January 1, 2017, and up to almost US $1,400 by January 2018. Token holders who had bought ETH for US $0.30 when it was launched in 2015 were able to get a 6,390.90% in investment return.
But while Ethereum experienced more rapid growth over the past years than Bitcoin, more recently Bitcoin has been showing better results. Bitcoin grew in June 2019, while Ethereum rose by roughly 30%. Also, during the last two months, the share of ETH on the market has dropped from around 10% to 7.5%. At the beginning of August, Ethereum was up by 1.07%, and tokens are currently being traded at around US $180.
Litecoin market cap
Litecoin was created to eliminate the main flaws of Bitcoin: high fees and low speed. The project succeeded, and Litecoin boasts processing speeds four times faster than Bitcoin and transaction fees 37 times lower. The currency itself sits at 5th place in terms of the crypto market capitalization and is considered to be a mature mid-cap cryptocurrency.
During the bull market of 2017, Litecoin experienced a rapid growth of 8,560% throughout the year. This year, from January to June, the price of LTC grew by around 300%. The currency has undergone some price fluctuations in the last month, however, due to halving of its mining reward. Starting this August, the reward for producing a block is halved from 25 LTC to 12.5 LTC.
Experts expect that this event will likely cause a spike in Litecoin’s price very soon, as it was with the first halving of Litecoin in 2015 when LTC grew from US $1.5 to US $3. However, on the day of the halving, there was only a minor surge of around 10%. As of publishing time, the crypto market cap of Litecoin is around US $4.6 billion and one LTC is being traded for around US $75.
Dash market cap
Dash was among large-cap coins at the end of 2017, during the market peak. Back in December 2017, its crypto market cap reached the US $12 billion mark, just three years after the initial release of the coin. Dash is also known for showing one of the highest ROIs: since its launch, the currency has grown by more than 9,000%.
However, since the market’s recent peak at the end of June, the price of Dash, along with that of other cryptocurrencies, has dropped. Dash’s spiral was more significant than other major cryptocurrencies. It fell by 45% while Bitcoin dropped by 11.8% and Ethereum by 40%.
Now, the currency is again experiencing growth and is one of the top ten cryptocurrencies to keep an eye on this year. Just recently, Dash/USD pair was among the top five performers thoughout the middle of August. As of publishing time, the crypto market cap of Dash is around US $850 million and one Dash token is being traded for around US $95.
Monero market cap
Monero is the most powerful cryptocurrency in terms of market capitalization among privacy coins. At the moment, Monero is considered to be a mid-cap cryptocurrency with a current crypto cap of around US $1.4 billion. This is almost four times higher than the market cap of Zcash, another major privacy coin. This strong performance comes as a surprise, after a 30% drop in the coin’s value over the period since the end of 2018. Monero’s June market cap of US $2 billion was the highest it’s been since September 2018. In August, Monero, along with Dash, has been among the top five performers of the week.
Monero is set to have a maximum of 18.4 million coins that will be put into circulation until May 2022. After that date, 0.3 XMR will be put in circulation every minute. This change can increase the coin value in the future. At the moment, the price of one XMR is around US $85.
Bitcoin Cash market cap
Even though Bitcoin Cash at its core has the same technological features as Bitcoin, it has some important distinctions. At the moment, the circulating supply of BCH is higher than those of Bitcoin: 17,955,600 BCH vs. 17,884,737 BTC.
There is also a huge value gap between the coins. BTC is about 33 times higher in price than BCH, so the market cap of these coins is, of course, also very different. After reaching a record price of US $4,000 at the end of December 2017, Bitcoin Cash hasn’t been experiencing any significant gains and now being traded at around US $310 for one coin. At the moment, Bitcoin Cash is in fourth place in terms of market capitalization, just after Bitcoin, Ethereum and Ripple. The current crypto market cap of BCH is US $5.5 billion.
In favor of Bitcoin Cash is the difference between transaction fees for BCH and BTC. At the moment, the fee for processing BCH is 340 times lower than the transaction fee of BTC.
The crypto market capitalization is a good metric to analyze how valuable a cryptocurrency is; however, it is not the only one. A variety of factors influence the price of a cryptocurrency: the current market demand, new evolving cryptocurrencies, the support a coin gets from cryptocurrency exchanges, and the impact of government regulation. These factors should also be taken into consideration when making an informed decision about buying or selling any cryptocurrency.