Why is the Koinos community so confused about the market cap?

If you try asking the community, “What’s the Koinos Market cap?” you might be surprised that not everyone agrees on a number.

But why would that be?

Let’s take a second to break down what “Market Cap” actually is…

It’s not the amount of money invested in a token…

It’s not the amount people have “spent”…

Market Cap is just a very simple equation:

Current token price multiplied by token supply.

If someone mints a token with 1,000,000,000 tokens and sells 1 token for $1, their market cap is now $1,000,000,000.

The problem is that they can’t actually sell the remaining 999,999,999 tokens.

This is the difference between market cap and liquidity. If a token is “liquid,” then that essentially means that people are able to buy and sell the token without drastically increasing or decreasing the price. If someone can sell a large quantity of tokens with minimal impact on the purchase price, this is a highly “liquid” token, and thus “justifies” the market cap.

As we said, Market Cap is not “the amount of money in the market” but a presumed market value if the ENTIRE market was liquidated (which isn’t possible).

So… why all the confusion with Koinos?

The primary reason there is a question of market cap comes down to two things: claimed tokens and burned tokens.

Let’s start with claimed tokens…

Koinos initially launched as a mined token on the Ethereum blockchain. Close to 100,000,000 tokens were minted. There was a snapshot on the Ethereum blockchain that essentially means anyone who held the KOIN token at that time was credited that amount of tokens on the Koinos mainnet, once the mainnet launched.

So with no mainnet, and the snapshot taken, there was technically “no token.”

So what was the market cap?

The last price of the token sold times 100,000,000? That wouldn’t make sense. The “market cap” at this time was technically $0…

Fast forward to the mainnet launch. People start claiming tokens and mainnet KOIN gets listed on an exchange.

Now, the token is $1.80, so the market cap is $1.80 multiplied by 100 million, right?

But wait, only 50% of the mainnet tokens were “claimed.” The unclaimed tokens still have no value, just like before mainnet, correct?

You can’t trade an unclaimed token…

And when will these tokens be claimed?

Did someone lose their wallet keys?

Who knows, but… The divide is clear. Are unclaimed tokens a part of the market cap or not?

So let’s say, “OK, unclaimed tokens are not a part of the market cap”; they can’t be traded and aren’t counted for mining ROI (a whole other argument as to why they may not count).

So 50% claimed, that’s 50,000,000 tokens times $1.80, right?

Well, let’s not forget about how the Koinos network functions. Miners secure the network by burning their KOIN, converting it to VHP, which is used to power their node and slowly converts back to KOIN with interest over time. VHP can be traded just like any other token, but it’s not KOIN, and nowhere near as “liquid.”

So if you can’t liquidate and sell your VHP for KOIN necessarily at a 1 to 1 value, does it count towards the “market cap”?

If 30% of the total CLAIMED KOIN has been burned for VHP, that only leaves 35,000,000 tokens…


Is it…

100,000,000 x $1.80 = $180,000,000
50,000,000 x $1.80 = $90,000,000
35,000,000 x $1.80 = $63,000,000

We will leave that up to you to decide, but hopefully, this helps explain the confusion.

You can check the current claimed tokens %, burned token %, and corresponding market caps anytime at https://koiner.app/