1 $DAO = 1 $DAO OR WHAT REALLY DETERMINES THE VALUE OF A DROP? 💰
After yesterday’s post, we noticed many misconceptions from users claiming that “if everyone farms millions of $DAO, the conversion will be 1:1, they’ll create a trillion supply, and the drop will be worthless”. This is NOT TRUE 😐
The value of any token in the crypto market primarily depends on its MARKET CAPITALIZATION
✔️ Formula:
Market Capitalization (Market Cap) / Circulating Supply = Price
Example:
• If the token supply = 10 billion and the market cap = $10 billion → price = $1
• If the token supply = 10 million and the market cap = $1 million → price = $0.1
The number of tokens ≠ their value. A 1:1 conversion and a large supply don’t automatically make a drop low-value or high-value. Other factors like demand, tokenomics, liquidity, and overall market sentiment also play a role. But the defining factor here is market capitalization 🧠
Examples from the market:
• Shiba Inu token with a price of ~$0.00001564 and a market cap of ~$9.2 billion
• Ultima token with a price of ~$17,895 and a market cap of ~$669 million
Comparing these, we can see that the price of 1 Ultima token is over a BILLION times higher than the price of 1 Shiba Inu token, while Shiba Inu’s market cap is 13 times larger than Ultima’s
We hope this helps clarify this important point for you 💙