Well, I'm still learning and sharing useful information with you newbie friends like me. Thanks to the person who recently donated a tip. They motivate me to continue creating content that contributes to the community.
Today I will explain to you (using $PEPE as an example) how the price of a cryptocurrency is calculated, what is market capitalization?, and the reason why it is impossible for $PEPE to reach 1 $.
Well... Let's start
The price of a cryptocurrency is calculated as follows:
Price = Market capitalization ÷ Supply (Number of shares outstanding)
In this case, the capitalization of PEPE as of the date of this writing is approximately: 3220000000 (3.22B Dollars). If we divide it by the current supply which is 420,690,000,000,000 (420.60T Dollars), it gives us the estimated price of: 0.00000765409 (clearly when reading the publication you will see that it will have changed since the price is a changing value).
Having said the above, we then have that market capitalization (MARKETCAP) is an indicator that measures and tracks the market value of a cryptocurrency. This is calculated by multiplying the current price of the cryptocurrency X supply. Let's then calculate how much MarketCap PEPE would need to reach $1, doing the mathematical calculation as if he had already achieved it, like this:
Current Price $1 (ASSUMING YOU'VE ALREADY ACHIEVED IT) X Supply = $420,690,000,000,000 (420T Dollars) from MarketCap.
Do you want to get an idea of how much money that is? Let's make some comparisons...
$BTC Bitcoin, the most famous cryptocurrency in the world, the queen of all cryptocurrencies, has a current MarketCap of: 1,370,000,000,000 (1.36T Dollars). We would then be talking about a MEMECOIN without any use, doing more than 420 times what BTC has done to date.
Let's be even more realistic, the global market capitalization of ALL cryptocurrencies is $2.63T.
But I'll be even more honest with you, the earth has not yet produced money to move such amounts of money.
With this Post what I want is for you to filter your Feed, checking who is making posts with the phrase "PEPE 1$ Soon". That publication will tell you a lot about how much that person knows about this world of cryptocurrencies and I would say about the financial markets in general. If they come up with the story of the "Burning of cryptocurrencies" then do the calculation with the resulting Supply after each "burn" and you will see the real or unreal of whatever they say...
I don't consider myself an expert, I'm learning. But it just requires reading a little and approaching the matter logically.
Finally, the simple mathematical exercise in the example will serve as a guide to calculate the real growth potential that any cryptocurrency can have. This way you will stop eating so much FOMO.
If you found it useful, remember to leave your like, comment and share. It is not a strategy. So tips as always will be voluntary :)
Good vibes! 👍
