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There is no correlation between market cap and capital inflow!

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by COINS NEWS 128 Views

News sites and users here keep reporting money that has flowed into the market, even though only the market cap has increased. There is no connection between these two things.

Just because the market cap increases by x does not mean that x amount of money has flowed into the market.

Let's pretend we got a coin with a supply of 1,000 coins and a current market cap of $1,000,000. Now you go to an exchange and find a single sell order with only 1 coin at the price of $2,000. Since you are broke you only want to buy 0.001 coins and pay $2.

Your transaction will set the new market cap to $2,000,000 which is an increase of $1,000,000 though the inflow was only $2.

submitted by /u/Skeptain
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