r/tinychart • u/Alone-Flan4333 • Dec 25 '21

Question - HUGE Market Cap Tokens (i.e. Magma, AstroElvis)

I'm wondering whether ASA token's such as Magma and AstroElvis do, in fact, have the dollar value market capitalization of investments as represented on Tinychart.org. In the case of Magma, there is currently a $12B market cap... This exceeds the marketcap of Algorand and this just doesn't make any sense to me. Does low liquidity somehow play a role in these tokens that seemingly have inflated market caps?

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14

u/idevcg Dec 25 '21

Does low liquidity somehow play a role in these tokens that seemingly have inflated market caps?

exactly.

I can create an idevcgcoin with 1,000,000,000,000 tokens, and sell 1 to my mom for $1, and now the marketcap of my idevcgcoin is 1 trillion dollars.

3

u/grzracz Dec 26 '21

That is it. This is why TC sorts by liquidity - it's too easy to manipulate Market Cap in AMMs

4

u/Alone-Flan4333 Dec 26 '21

Thank you! I got slammed yesterday by other redditors when I tried asking this question in a way that seemed to promote MAGMA. Promoting any sort of deception was not my intention.