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Because the value of cryptocurrency is strongly effected by the volume of buy and sell pressure. Market cap implies that a level of liquidity which is likely no
by 60secz 5y ago
Because the value of cryptocurrency is strongly effected by the volume of buy and sell pressure. Market cap implies that a level of liquidity which is likely not present -- it can very difficult to sell large amounts of most crypto without at least temporarily tanking the value.
- eloff 5y agoMarket cap doesn't imply liquidity, not for equities either. A larger market cap might be correlated with more liquidity, but you readily want to look at shares outstanding and average volume to measure liquidity. I don't see why crypto is special here.