PSA: Market cap is meaningless without liquidity

Hey,

so something I noticed here is that quite often some more obscure coins are being compared by their (often ridiculously high) market cap alone. But that's basically like judging a book by its cover. Just because a coin has a high market cap doesn't necessarily mean the whole project is worth a lot. Most of you probably know this, but for those who don't, here's why:

Because market cap doesn't take into account liquidity. Liquidity is like the lifeblood of a cryptocurrency. It's what makes it easy to buy and sell without affecting the price. A coin with low liquidity may have a small number of buyers and sellers, which means that it can be difficult to buy or sell without affecting the price. As a result, the market cap of a coin with low liquidity may not accurately reflect its true value.

To put it in simpler terms, let's say you have a jar of 1000 bottle caps. You sell one to your friend for $1000 USD. If we were to calculate the market cap of your bottle caps based on this sale alone, it would be $1 million USD! But that doesn't mean your bottle caps are actually worth $1 million USD. In fact, that tx to your friend was probably a rouse and the bottle caps are worthless, even though they are now listed as a $1m jar...

Hope this makes sense and helps when looking at different projects!

TL;DR: Always look at the context of things when evaluating numbers.