đ„ A week that increases $500 billion in market capâdoes that mean $500 billion is being injected?
This morning, I updated you guys and the market cap. I also received a few questions about market cap and cash flow. If someone asks, then letâs pull it out and figure it out together, okay guys.
đ First, we must define âMARKET CAPâ differently from âCASH FLOW,â with a clear concept:
1. Market cap is the value âpriced/valuedâ by the current price Ă the number of circulating assets
2. Cash flow is real fresh money flowing in and out⊠For the financial market, cash flow is the lifeblood. It can be so intense that itâs a mess :)))
Real example:
- One Altcoin has 1 billion tokens. The assumed market cap is around 500m$ , meaning the price is $0.05/token.
- During that process, when sellers place orders, buyers jump inâbut with overwhelming volume. There are entries at 0.5, then 0.55, 0.6, 0.7, and up to 0.8$. At this point, the market cap has risen to about $800 million, but the cash flow is only around $40â80 millionâŠ
Another example:
- In one neighborhood, there are 100 real estate properties, each worth 10 billion (total 1000 billion in valueâvalued valueâŠas a stand-in for market cap).
- Somehow, one of them needs money and sells for 13 billionâŠ.then the people who want to sell afterward start defining this areaâs value at 13 billion. In a snap, the market cap of this neighborhood jumps to 1300 billion.
đ One cash flow, a certain amount of money, can push the price value to a new level, and the market cap will be valued accordingly.
So when the market rises by $500 billion in market cap, it doesnât necessarily mean the cash flow also increases by $500 billion. And conversely, when the market crashes⊠it also doesnât mean cash flow is withdrawn in the same proportion as market cap. But cash flow is realâprice movement shows that the market is being pumpedâŠ
Well⊠itâs probably right, right? :)))
This morning, I updated you guys and the market cap. I also received a few questions about market cap and cash flow. If someone asks, then letâs pull it out and figure it out together, okay guys.
đ First, we must define âMARKET CAPâ differently from âCASH FLOW,â with a clear concept:
1. Market cap is the value âpriced/valuedâ by the current price Ă the number of circulating assets
2. Cash flow is real fresh money flowing in and out⊠For the financial market, cash flow is the lifeblood. It can be so intense that itâs a mess :)))
Real example:
- One Altcoin has 1 billion tokens. The assumed market cap is around 500m$ , meaning the price is $0.05/token.
- During that process, when sellers place orders, buyers jump inâbut with overwhelming volume. There are entries at 0.5, then 0.55, 0.6, 0.7, and up to 0.8$. At this point, the market cap has risen to about $800 million, but the cash flow is only around $40â80 millionâŠ
Another example:
- In one neighborhood, there are 100 real estate properties, each worth 10 billion (total 1000 billion in valueâvalued valueâŠas a stand-in for market cap).
- Somehow, one of them needs money and sells for 13 billionâŠ.then the people who want to sell afterward start defining this areaâs value at 13 billion. In a snap, the market cap of this neighborhood jumps to 1300 billion.
đ One cash flow, a certain amount of money, can push the price value to a new level, and the market cap will be valued accordingly.
So when the market rises by $500 billion in market cap, it doesnât necessarily mean the cash flow also increases by $500 billion. And conversely, when the market crashes⊠it also doesnât mean cash flow is withdrawn in the same proportion as market cap. But cash flow is realâprice movement shows that the market is being pumpedâŠ
Well⊠itâs probably right, right? :)))