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The number of zeros in a coin doesn't determine its worth. Case in point: #Shiba has created countless millionaires and even a billionaire, despite having five zeros, with a market cap of around $17 billion. 💼💸
For those unfamiliar, the market cap is calculated by multiplying the price by the circulating supply in the market. Let's break it down with an example: 📊
Imagine Migros and our uncle Hüseyin, the grocer, offering all their shares to the public. If Migros's total value is $100 million and shares are divided into 100,000, one share's price will be $1,000. On the other hand, if Uncle Hüseyin's grocery is valued at $500,000 and divided into 50 parts, each share of his will be $10,000. 💡💼
In this example, you can see the formula: price x supply = market value. 📈
Migros: $1,000 x 100,000 = $100 million
Grocery store: $50 x 10,000 = $500,000
Now, let's say Carrefour offers all its shares, valued at $100 million, but wants to sell 100 billion pieces. Now, each share's price would be $0.001. It may seem absurd to compare Carrefour's $0.001 share price to Migros's $1,000, but it's the market value that matters, not just the price. 💡🔄
Similarly, if Caddebostan offers monopoly rights on the beach valued at $500,000, and divides it into 10 pieces, each selling for $50,000, it wouldn't be rational for Tekel's shares to be priced at $50,000 when the neighborhood grocery store's shares are $10,000. But investors may still buy Tekel shares, thinking there must be a difference between them. 💭💼