Due to the rise in the price of Bitcoin, its capitalization increased considerably. It is important to note that “Market Cap” is the term used to define the market capitalization of cryptocurrencies, which is determined by taking into account the “reserves” of the currencies in circulation in the market; this data is multiplied by the price of a unit.
It must be taken into account that the price of a currency is generally calculated as an “average,” which is determined after analyzing several purchase and sale operations; it is important to note that the prices indicated may vary slightly in what Regarding Bitcoin with the purchases-sales available worldwide.
How to calculate capitalization
To calculate the Market Cap, you can use the following example: if you want to calculate the market value of Bitcoin, we must take into account the reserves in the circulation of this cryptocurrency, which is 17.3 million units, each Bitcoin costs more than $ 50,000 today, multiplying these two amounts will give $ 865 billion, which will be the capitalization value.
This method also applies to other cryptocurrencies. It is important to clarify that a single cryptocurrency market capitalization is different from the market capitalization of a set of cryptocurrencies (the latter calculation is more difficult to determine). The Market Cap is always calculated by adding and adding the general valuation of all the Tokens.
Comparison with gold
If we compare the market capitalization of Bitcoin with the market capitalization of gold, we can see that the valuation of Bitcoin has reached almost 10% of the market capitalization value of gold, which is a very relevant number, especially if we take into account the age and prestige that this precious metal has. The interesting thing about analyzing the Market Cap of cryptocurrencies is that it allows us to know the evolution of this market capitalization over time. Concerning Bitcoin, a speedy capitalization growth can be observed; hence, when comparing it with gold, investors call it digital gold. The growth possibilities of this value look promising in the medium and long term.
Cryptocurrency Market Cap on the Rise
The market capitalization of cryptocurrencies has already exceeded one trillion dollars after the impressive rally of Bitcoin; it is important to note that the market took about 10 years to reach that value, some analysts estimate that this value may double in the next semester or year (which would reach two trillion USD especially if Bitcoin and Ethereum continue to rise). Several cryptocurrency market enthusiasts estimate that 2021 will be a good year for Bitcoin, especially due to the growing institutional demand, the ubiquity (ability to be present everywhere) of access platforms, and the natural flow of credit cycles. The Market of the recent four years.
What do you think about this topic? Do you think the price of Bitcoin will continue to rise?
If you want more information about buying and selling cryptocurrencies, you can contact us or write your query below (comments section).
Image by The Digital Artist via Pixabay.com under creative commons license.