Market capitalisation
What does a market's value actually measure, and why is it more than the price of one unit?
In plain words
Market capitalisation is the price of one unit multiplied by the total number of units in circulation, giving the market's whole outstanding value. A high price per unit does not by itself mean a large market.
Why it matters
Market size indicates how much money could absorb a position before moving the price. Note that traded volume is not market capitalisation: volume counts units exchanged in a period, while market cap values all units held. This card's data contains price and volume, not circulating supply, so market cap cannot be computed here.
In a real week: ETH, week of 26 February 2024
In the week of 26 February 2024, ETH rose from an open of 3112.6 to a close of 3487.81, a return of 12.05%, while trading 13.05bn dollars of volume, 1.92 times its prior 12-week average. Its supply is absent from this data, so no market capitalisation figure can be derived from these numbers, however far the price moved.
A common mistake
Confusing high price per unit with large total value, or treating traded volume as market capitalisation. A unit price alone says nothing about the number of units outstanding.