The difference between Market Capitalization and Fully Diluted Market Cap is how each is calculated:
1. *Market Capitalization*:
- Market value is calculated by multiplying the current price of the digital currency by the number of coins in circulation.
- The formula is: Market Cap = Current Price × Number of Coins in Trade.
- Market cap reflects the total value of a cryptocurrency based on the current supply.
2. *Fully Diluted Market Cap*:
- The fully discounted market cap is calculated by multiplying the current price of the cryptocurrency by the total number of coins that can be issued.
- The formula is: Fully discounted market cap = Current price x Total number of coins.
- The fully discounted market cap reflects the total potential value of the cryptocurrency if all possible coins were issued in the future.
In other words, market cap only takes into account coins that are currently issued and in circulation, while fully discounted market cap takes into account all coins that could be issued in the future.
