Price matters very little compared to market cap and supply distribution

I’ve heard too many people say something like, “It’s only $0.0001! If it just goes to $1 each I’ll be rich!” Or “Bitcoin? No way I can invest in that, it’s like $30,000!”

You should always look at market cap (the price of the coin * how many there are) and then ideally compare that to other coins if you are wanting to speculate on future price.

Let’s say rank 300 Shitcoin (SHT) costs only $0.0001 with a market cap of $105,000,000. The supply is comically large.

If SHT went to $1 that would make the market cap over a trillion dollars. Nearly double BTC’s market cap right now. It’s not happening.

Likewise if a coin is expensive but the supply is small, it’s not a big deal if it’s $5,000 each. You can buy .005 of it and it will be just as good as an investment.

However, one additional thing you should always consider is the supply distribution. If everything looks great but 99% of the supply is held by the dev they could dump it at any moment completely cratering the price. Likewise if you think the price / supply looks good now, make sure you know how supply is created because if the dev just launched a project and is putting 10,000,000 tokens a day into the ecosystem with big APYs then those tokens will quickly be worth very little each and if you bought some they will lose value.

There’s much more to picking an investment but I hope this clears up some common misconceptions for some!