# WHAT IS MARKETCAP?
Marketcap or market capitalization is a term in conventional securities.
> Marketcap is multiplying the amount of outstanding stock shares by the current stock price.
In chryptocurrency, marketcap is circulating supply of tokens or coins multiplied by current price.
https://www.coinist.io/cryptocurrency-market-cap/
If there are 1000 circulating tokens, and the price in exchangers is $2, it means that the marketcap is $2000.
# WHAT IS VOLATILITY?
> It is a rate at which the price of a security increases or decreases for a given set of returns.
https://economictimes.indiatimes.com/definition/volatility
After knowing those two terms, let ‘s see the relation among volatilty, market cap and investment. To put your money in chryptocurrency, you need to learn about a coin or project that you want to buy. There are two types of coin that you can buy and expect in return
1. Fixed coin with high return due to the rise of the price
It means that a coin that you buy is fixed in number. You buy for long term saving in expectation of the rise of the coin price. Bitcoin in 2009, was worth under $1. Investors who bought bitcoin in that year and let the coin dormant in wallet will earn high return today because the price of bitcoin exceeds 24 K USD.
2. Growth coin from staking or keeping in wallet of investment services.
Staking coin or leaving the coin inactive in wallet or apps for a certain time is called staking. You will earn reward by staking coin. You reward in APR is different among the coins. Current days, there is a booming dapps called defi. Defi is decentralized finance that will reward your liquidity coin if you lock your asset as liquidity in the network or pool. You will earn return in native coin of the dapps. You are also still own your asset.
Both types of investment have pros and cons. However, before investing a coin you should learn about market cap, volatility and future of the projects.
# THE BIGGER MARKET CAP THE LESS VOLATILE THE ASSET
A coin with high market cap is less volatile and a coin with low market cap is more volatile. This statement should be related to reputation of the developer team behind the coin. Before investing a coin you should decide a coin that has a good and trusted team.
Let’s learn about market cap in the chart !
Source :https://blog.bitgo.com/cryptocurrency-market-caps-and-volatility-bf0fc113e7a4
Investing in lower market cap coin will promise you with higher profit or return but the risk is also higher. When you in invest in Large marketcap in the chart is bigger than 10 B USD, the risk is lower but you will earn smaller return. Top ten chryptocurrency marketcap is less risky than investing in under 100 rank of marketcap.
Investing in bitcoin has lower risk than in BCH. However, when BCH price soars to $1000 you will earn higher return. There are many good coins that is listed in coinmarketcap. You can search for the coin under the rank 50. There are cool projects there to invest. If you are a type of speculative investor you can invest in a new project but you should be aware of scam projects in ICO or STO. What is your investment portofolio in chryptocurrency that has given you the biggest return? You can share and give comment in the post.
