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Domov Reddit Market Cap should be one of if not the biggest factor to...

Market Cap should be one of if not the biggest factor to consider when looking for new coins to invest in.

I’m sure what I’m about to say is nothing new for most people here, but for people who are just joining the space I wanted to make a quick post to discuss market cap.

Too many times I’ve spoken to people who have seen the potential investing in crypto provides. I think it’s very easy to get swept up in napkin math when investing in new coins and thinking “if I buy a hundred thousand coins at .005 and they go to one dollar I’ll have one hundred thousand dollars.”

While the math adds up, you have to consider that in order for a coin to grow the market cap (coin amount outstanding x coin price) has to grow at the same rate. For a lot of these alt coins with hundreds of billions of coins in circulation this is a huge ask. Shiba was a great example of this: a lot of people thought shiba could reach $1 as doge did and plain and simply it could not. Total supply of shiba is 550 trillion coins so you would need a market cap of $550T to reach this price.

Again, I’m sure none of this is new for most experienced investors here but newbies please take note. I like to look for coins with around $1-5B in market cap and a similarly sized total supply. This gives me a reasonable expectation of growth as well as a basic understanding of my price targets. This simple consideration has served me well on my crypto journey and I hope it can help you too!

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