Crypto By The Numbers

[Join us for our webinar, "Unpacking The Crypto ETF Dilemma," Tuesday, Nov. 16, 2021 at 12 p.m. ET]

Crypto seems to be everywhere lately. The media, celebrities and even your neighbor are all talking about it. From this perspective, crypto is huge. Everyone knows about crypto and the hype just keeps getting bigger.

But just how big is crypto really, based on the cold hard numbers?

According to CoinMarketCap, the total market capitalization of all crypto assets is $2.6 trillion. That’s a big number, but one that is dwarfed by the market value of traditional assets like stocks and bonds. For instance, as of this writing, the market cap of Apple alone is over $2.5 trillion.

Crypto Market Cap

Source: CoinMarketCap

The market cap of all the stocks within the S&P 500 is $40.3 trillion; the market value of the MSCI ACWI Index is $92 trillion; and the global bond market is worth $119 trillion.

From that perspective, crypto looks quite small. And that’s even more the case when you consider that, of crypto’s market cap, 46% comes from bitcoin alone and 19% from ether. All the other crypto assets only account for 35% of the crypto market cap, or $900 billion.

If you go one step further and strip out the top 10 crypto assets—like tether, ada, dogecoin and XRP—the market value shrinks further to $500 billion.

Don’t get me wrong: I’m not downplaying how far crypto has come. For bitcoin to come out of nowhere and be worth more than $1 trillion, and for other crypto assets to collectively be worth hundreds of billions of dollars, is no small feat. It’s downright impressive.

Differing Views

So, what do all these numbers mean? Well, you can interpret them in all sorts of different ways. There are those who see crypto as nothing more than a bubble. To them, $1 trillion in bitcoin might as well be $1 trillion in tulips.

But the longer crypto sticks around, the less likely that a bubble is all that it is. Perhaps it ends up being something niche, a playground for digital gold bugs and some collectors trading JPGs. Or maybe, just maybe, it turns out to be something much bigger.

There is a growing number of super smart people who see crypto as an important part of the next generation of the internet. They put it on par with critical technologies like artificial intelligence and augmented reality. If that’s the case, then a few trillion dollars of market value is really just a drop in the bucket.

Just The Beginning

If this bullish view is correct, then crypto is just getting started, and all of the numbers associated with the industry will probably keep going up over the long term. That includes the collective value of all crypto assets and the total number of such assets that exist.

While years ago, it might have been possible to know about every cryptocurrency or crypto token that was out there, that’s no longer the case. Currently, CoinMarketCap lists 13,285 crypto assets, a figure that has been continuously increasing. And that doesn’t even count the plethora of crypto assets—DeFi tokens, nonfungible tokens and DAO governance tokens—that aren’t necessarily listed in some central repository but still exist on a blockchain.

OpenSea, the world’s largest market place for NFTs—tokens representing ownership of digital collectibles, artwork and more—currently lists nearly 23 million items for sale.

Due to the open nature of public blockchains, anyone can easily launch a token. That means the number of potential crypto assets is unlimited, though obviously, not all of them will be valuable.

How To Invest

That’s an important point. Even if crypto as an asset class becomes more valuable, there is no guarantee that any individual asset—even bitcoin—will participate in that upside.

Where value accrues in crypto networks is still an open question, and one that will be answered over time. That raises some obvious questions for investors who want to participate in the growth of the industry. Do you pick and choose which assets will do well? Or do you take a basket approach through indexes and ETFs?

That’s one of several important topics we will be covering in our upcoming webinar, “Unpacking The Crypto ETF Dilemma,” on Tuesday, Nov. 16 at 12 p.m. ET. We’ve put together an amazing panel, including Matt Hougan, chief investment officer of Bitwise; Ric Edelman, founder of the Digital Asset Council of Financial Professionals; and Tim McCourt, managing director and global head of equity products at CME Group.

Matt’s deep knowledge of crypto and ETFs perfectly complements Ric’s three decades in the RIA business. And Tim brings the expertise of the futures markets that existing ETF efforts center around.

Join us as we break down how investors can best position themselves to capture the huge potential growth in this nascent asset class. We hope to see you there!

In the meantime, take our quick quiz to test your crypto knowledge here.

Email Sumit Roy at [email protected] or follow him on Twitter sumitroy2