Fundamental and Onchain Research · Crypto Trading Guide
A low token price is not a valuation argument. Examine circulating supply, dilution and unlock schedules before comparing projects.
Multiply the correct quantities
Circulating market capitalisation is price multiplied by the circulating supply estimate. Fully diluted valuation uses a broader supply measure, often maximum or total supply depending on methodology. These numbers describe an implied valuation at a marginal price. They do not measure the cash invested or the proceeds available if every holder sold.
Work through dilution
A fictional token trades at $2 with 100 million units circulating and a maximum supply of 500 million. Circulating market cap is $200 million and maximum supply based valuation is $1 billion. If 20 million units unlock, circulating supply could rise 20% under the stated classification. Holding price constant would raise circulating market cap to $240 million, but constant price is an assumption rather than a forecast.
Investigate who receives supply
Inspect vesting documents, issuance rules, treasury holdings and any ability to change supply. Distinguish an unlock from a transfer and from an actual sale. Recipients may retain, stake, hedge or sell tokens. A scheduled amount alone cannot tell you which action will occur. Compare the unlock with realistic market depth, not only a large reported daily volume.
Connect valuation with economics
Ask what rights the token grants and how network usage might affect demand, fees or burns. A high valuation relative to fees can be a useful research prompt, but fees paid to validators are not automatically holder revenue. Record supply definitions and the date of the estimate. When providers disagree, investigate methodology rather than averaging incompatible numbers. Avoid comparing a fully diluted figure for one token with a circulating figure for another without saying so.
Try it yourself
A token at $0.50 has 2 billion circulating units. Another at $100 has 1 million. Which has the larger circulating market cap?
Show the worked answer
The first is $1 billion and the second is $100 million. The lower unit price belongs to the larger valuation in this example.
Further reading
Educational material. Examples and rates are hypothetical, not trade recommendations. Product terms, eligibility and risks vary by venue and jurisdiction.
