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What Is Market Cap (Market Capitalization)?

Definition

Market cap is the total value of all tokens in circulation, calculated as token price multiplied by circulating supply. It's the primary metric for comparing token sizes.

Market capitalization = Current price per token × Circulating supply

For example: if your token trades at $0.001 and there are 1,000,000,000 tokens in circulation, the market cap is $1,000,000 (1 million).

  • Large cap: $10B+ (BTC, ETH, SOL)
  • Mid cap: $1B-10B (established altcoins)
  • Small cap: $100M-1B (growing projects)
  • Micro cap: $10M-100M (early-stage tokens)
  • Nano cap: Under $10M (most new tokens)
  • It determines how your token is perceived (a $100K market cap project looks small; $10M looks established)
  • The initial market cap is set by your liquidity pool ratio — if you deposit 1,000,000 tokens + 1 SOL, and SOL is $150, your initial market cap is $150 (extremely low)
  • Investors and exchanges evaluate projects partly by market cap

Fully Diluted Valuation (FDV) is market cap calculated using total supply instead of circulating supply. If you have tokens locked in vesting, FDV will be higher than market cap.

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Related Terms

Tokenomics
Tokenomics is the economic design of a cryptocurrency token — covering supply, distribution, utility, incentive mechanisms, and how these factors affect the token's value over time.
Liquidity Pool
A liquidity pool is a pair of tokens locked in a smart contract that enables decentralized trading on automated market makers (AMMs) like Raydium and Uniswap.
Token Burn
Token burning is the permanent, irreversible destruction of cryptocurrency tokens — reducing the circulating supply and making remaining tokens scarcer.