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"Market cap" is a basically ridiculous measure to use of crypto assets. It implies a realisability of price that really just isn't there. Trading is too thin a
by davidgerard 10y ago
"Market cap" is a basically ridiculous measure to use of crypto assets. It implies a realisability of price that really just isn't there.
Trading is too thin and the price is too volatile, even for the most-traded one, Bitcoin. Consider the recent Bitcoin flash crash on GDAX, where BTC dropped from $1184 to 6 cents - this was courtesy about 100 BTC of trades.
Then there's the Bitcoin "price", which is a weighted average ... including exchanges like Bitfinex, where the USD "price" includes a huge premium because you literally can't get hard currency out of Bitfinex for the foreseeable future.
It's a hyped number to pretend this stuff is worth more than it is and attract attention.
- Jenya_ 10y agoGDAX example is not a good one. They started up trades after the maintenance shutdown and they did it incorrectly. They allowed market trades before order book had a chance to fill up.
- davidgerard 10y agoMy point was how thin the order book turned out to be. This is why the Bitcoin price is so ridiculously volatile. Single trades, even on the Chinese exchanges, frequently send the price up or down tens of dollars.