Quote from: QuestionAuthority on January 14, 2018, 05:57:35 PM

Quote from: dankJ on January 14, 2018, 05:19:56 PM

Quote from: QuestionAuthority on January 13, 2018, 05:32:03 PM

Quote from: D D zee on January 13, 2018, 05:20:57 PM

Quote from: QuestionAuthority on January 13, 2018, 04:51:20 PM

Oh god, you have to keep explaining the same fucking thing here over and over again.

Market capitalization is a useless metric for measuring the value of a commodity or currency. Market cap is also incorrectly used to tell what a company is really worth. The market cap formula is simply this: The amount of dollars per share of a company x the total number of shares of that company. Market capitalization is about the price of a company. It only tells other companies what they are likely to need to pay to gobble up another company. The economic pigmies that set up these bitcoin price sites years ago started using market cap like they are describing the value of a company because theyre dumbasses. All the follow the leader dumbasses copied what they were doing on other sites so it spread. Bitcoin has a fixed number of shares so all market cap is telling you is the current price of bitcoin. The number of shares will increase slightly until all 21m are mined and then it will be fixed forever. It would be more useful to discuss the effect of monarch butterflies landing on superheated bitcoin mining equipment as it relates to increasing the user base of bitcoin.

might be because I'm newbie, but I don't quite understand your point. what's wrong with the use of market cap? how would you calculate the total worth of the market? coin price alone means nothing cause there can be 1 coin or 1 bil coins. coin supply alone doesn't say anything either without knowing it's price. but if you multiply the coin supply with the current coin price you get how much money the market is worth in current prices.

Ok, Ill give you that. How would you know if dont understand what a market cap is.

Market cap is used to set investor expectations and shape investment strategy. There is no official barrier for different categories of stocks based on size, but large caps are often companies with market caps over $10 billion, mid cap is $2 billion to $10 billion and small cap refers to companies under $2 billion. Different types of investment strategies focus on the various market cap groups, and different valuation methods are applied depending on company size. Very large market caps are usually associated with mature, low-growth companies that pay dividends. Small caps are often growth companies with higher-risk profiles and generally do not pay dividends.

For bitcoin market cap tells you nothing about maturity, nothing about potential growth, nothing about user base, nothing about true value, nothing about whether its a good investment or not, nothing about size. It only tells you what bitcoin is priced at based on the current number of coins in circulation. So essentially its the same thing as looking up the price except to find out the current price using market cap you need to divide out the cap and total coins to find out the price. Why dont you just look at the price first without doing all that work?

"It only tells you what bitcoin is priced at based on the current number of coins in circulation." ..... that EXACTLY the same information that market cap of any stock would tell you.

Its the same information conveying the same thing. Its simply used as a comparison tool to compare different asset classes and gives a rough 'value' of said stock/coin/indice/etc. If i have 100 of something and each one is worth 5 bucks... then my 'market cap' is 500 ..... stop over complicating this. its a rough comparison tool. S&P500 market cap is 10T ...crypto's 700B ...ok that tells me the crypto market is about 7% the size of the s&p in terms of 'wealth'. (and i only use that comparison for analogy sake ...not commenting on the crypto or s&p for the sake of this post

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Right! Thats why you dont use market cap as a metric for stocks, commodities or currency. Its only valuable for showing the size of a company and its dividend class. It tells you nothing useful about stocks, just like it tells you nothing useful about bitcoin. Comparing the s&p to bitcoin is like comparing starships to automobiles. Sure they are both for transportation but thats where it ends.

I dont know..i feel it has SOME value. I see it as a kind of starting point? A very broad base from which to grow an opinion from? and using your analogy starships and automobiles... (going VERY hypothetical here, lol...) lets say the market cap of starships is 200B and autos 2 T .... starships' rough estimate of value is 10 % of the autos. But maybe i think starships could be as big as autos...or half as big. Using that broad opinion...i can look at market cap and see its at 10% the 'value' of autos...i think it should be 50% eventually... so, by using the market caps of the 2...i see perceived value in starships. Now, i certainly wouldnt make any investing decisions based solely on market caps of anything...but again...i see it as a jumping off point in certain situations.

I can use it now in my research on ETH...i think versus BTC it has more potential and room for growth...so i could look at the market caps of the 2, compare them, and get a very rough estimate of ETH value vs' BTC...then go from there.

and to give my opinion on the original question...nothing. the same that happened when dow hit 25k. news outlets talk about it for a few news cycles, then it becomes 'old news' and back to business as usual. maybe get some dumb money chasing the rockets....

dankJ

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