Not financial, legal, or tax advice. Market cap is one data point, not a complete measure of quality or safety.
Market cap in crypto is a cryptocurrency's price multiplied by its circulating supply, giving a rough sense of the asset's total value and relative size compared to others. It's a useful starting point for comparison, part of the broader evaluation process in \[pillar hyperlink: What Is Cryptocurrency\].
The formula
Market cap equals current price multiplied by circulating supply. A coin priced low can still have a large market cap if enough units are in circulation, and vice versa; price alone says little about size.
Circulating vs. total supply
Circulating supply counts coins currently available and tradable; total supply includes coins that exist but may be locked, reserved, or not yet released. Market cap calculated on circulating supply reflects what's actually accessible in the market right now.
Caveats
Market cap can be misleading for thinly traded assets, since a small amount of buying or selling can move the price, and by extension the market cap, disproportionately. It's a size indicator, not a measure of an asset's quality or safety.
Using it for ranking
Market cap is the standard way crypto assets are ranked by size, useful for comparing scale at a glance. For a fuller picture before buying anything, pair it with the deeper checks in How to Evaluate a Crypto.