What will be the largest Top 10 CryptoCurrencies By Market Cap in 2024?

In cryptocurrency news magazines you will often read about the market cap or market capitalization of a crypto coin. But what is this and how is this exactly calculated? 

To calculate the market capitalization of a cryptocurrency, you multiply its current market price by the total number of coins or tokens in circulation. This method actively evaluates a cryptocurrency’s total market value.

For example, if a cryptocurrency has a circulating supply of 1 million coins and each coin’s current market price is $10, its market capitalization stands at $10 million. This figure acts as a snapshot, showing the total value investors attribute to that specific cryptocurrency at a particular time.

Difference between circulating supply of a coin and the total supply

Market capitalization bases itself on a cryptocurrency’s circulating supply, distinct from its total supply. The circulating supply includes the number of coins available in the market for trading, while the total supply encompasses all mined or created coins, even those not currently available for trade.

In the crypto world, market capitalization serves as a crucial metric, enabling investors to gauge the relative size, value, and significance of various cryptocurrencies. It plays a vital role in assessing a cryptocurrency’s growth potential and widespread adoption. However, it’s important to note that market capitalization is just one among many factors to consider while evaluating cryptocurrencies and should not be the sole determinant for investment decisions.

Top 10 cryptocurrencies by market cap

As of December 20, 2023, the market capitalization for Bitcoin (BTC) is approximately $861 billion, making it the coin with the biggest market cap. But what do the other coins do now that we enter 2024? Let’s have a look.

1. Bitcoin (BTC)
   • Price: $44,189.04
   • Market Cap: $861.2 billion
   • An unknown person or group under the pseudonym Satoshi Nakamoto created Bitcoin (BTC), which introduced blockchain technology and revolutionized digital payments. Bitcoin stands out for its decentralization, transparency, and secure framework for peer-to-peer transactions.
2. Ethereum (ETH)
   • Price: $2,274.76
   • Market Cap: $273.7 billion
   • Vitalik Buterin and others developed Ethereum (ETH), which extends beyond Bitcoin’s capabilities by supporting smart contracts and decentralized applications (dApps). This has established Ethereum as a key platform for various blockchain initiatives, including NFTs and DeFi.
3. Tether USD (USDT)
   • Price: $1.00
   • Market Cap: $87.1 billion
   • Tether USD (USDT) is a stablecoin designed to maintain a 1:1 value ratio with the US Dollar, commonly used for transferring value between crypto exchanges. It helps provide stability in the volatile market.
4. Binance Coin (BNB)
   • Price: $271.08
   • Market Cap: $42.9 billion
   • Binance Coin (BNB) was initially a utility token for the Binance exchange but has since broadened its use to include transaction fee discounts and token sales. It plays a vital role in the Binance DEX.
5. Solana (SOL)
   • Price: $87.68
   • Market Cap: $37.2 billion
   • Solana (SOL) is a high-performance blockchain known for its quick transactions and low fees, making it a strong competitor to Ethereum in hosting dApps and DeFi services.
6. Ripple (XRP)
   • Price: $0.6208
   • Market Cap: $33.3 billion
   • Ripple (XRP) aims to improve cross-border payments, offering a quicker and more cost-effective alternative to traditional banking. XRP is unique in its centralized transaction processing.
7. USD Coin (USDC)
   • Price: $1.00
   • Market Cap: $24 billion
   • USD Coin (USDC), another stablecoin pegged to the US Dollar, provides market stability. It’s managed by a consortium called Centre, founded by Circle and including members like Coinbase.
8. Cardano (ADA)
   • Price: $0.6109
   • Market Cap: $21.4 billion
   • Cardano (ADA), co-founded by Ethereum’s Charles Hoskinson, focuses on a more secure and scalable platform for smart contracts and dApps.
9. stETH (STETH)
   • Price: $2,270.80
   • Market Cap: $20.4 billion
   • stETH (STETH) represents staked Ethereum in the Ethereum 2.0 Beacon Chain, allowing for reward earnings while maintaining liquidity.
10. Avalanche (AVAX)
    • Price: $45.27
    • Market Cap: $16.2 billion
    • Avalanche (AVAX), created by Ava Labs, is a blockchain platform known for its high throughput, low latency, and eco-friendliness, hosting various applications like DeFi and NFTs.

A Market Cap is not Static

Remember, the market capitalization of digital assets is dynamic, not static. The figures and rankings we observe are specific to a given moment and can change. A variety of factors, including market conditions, investor sentiment, regulatory updates, and technological advancements, actively influence cryptocurrency prices and their market capitalizations.

Take Bitcoin halving events, for instance, which historically impact the cryptocurrency’s price and, by extension, its market capitalization. A halving event halves the rate at which new bitcoins enter circulation by reducing the number of bitcoins created and given to miners for adding transactions to the blockchain.

This decrease in new bitcoin supply can, under the basic economic principle of supply and demand, lead to a rise in Bitcoin’s price. If the new bitcoin supply slows and demand remains constant or increases, Bitcoin’s price may increase. An increase in price, provided the number of bitcoins in circulation stays fairly constant, would result in a higher market capitalization for Bitcoin.