When you look at a token’s price (all down bad now LMEOW), what amount of supply are you valuing?

Token valuations answer that question --> Crypto needed various metrics because tokens don’t behave like equities:
• A normal tokenomics piechart tells you that supply is split across public float, locked allocations, vesting, future emissions, burns
• 2 tokens at “$200m market cap” can have completely different dilution + liquidity realities

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We relied on 2 methods thus far
a) Market Cap (MC)
• Default “ranking” metric where MC = Price × Circulating supply (public float)
• Gives us an idea as to “what the market is actually paying for today’s tradable float”
• But severely understate the valuation of a low-float token (because most supply is locked / not counted)

b) Fully Diluted Valuation (FDV)
• Gives a “what if everything exists and is liquid” view where FDV = Price × Max supply
• Forces investors to think about dilution but can also be just pure fantasy if max supply is far away, or emissions are uncertain

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Both @CoinMarketCap and @coingecko added a new middle metric to their analytics --> Minted Market Cap (MMC) / Outstanding Token Value (OTV)
• MMC/ OTV = Price × Total supply (minted / issued, net of burns)
• Prevents valuation to be solely based on just the float (MC) nor on hypothetical future tokens (FDV)
• MMC/ OTV values tokens to what already exists on-chain today

Why MMC/OTV is needed
• Lots of tokens have huge gaps between circulating (float) and minted supply (not public)
• Those tokens are “cheap” on MC, but insanely overpriced on FDV
• MMC/OTV tells you how big is an asset is based on issued supply currently

Quick summary
• MC → value of the public float
• MMC/ OTV → values everything minted today (locked + unlocked, excluding all token burns)
• FDV → values the maximum possible supply (the full dilution)

Usually, FDV ≥ MMC/OTV ≥ MC

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Numerical example
Assume a token is trading at $2
• Circulating supply = 20,000,000
• Total (minted) supply = 100,000,000
• Max supply = 1,000,000,000

The math
• MC → $2 × 20m = $40m
• MMC/OTV → $2 × 100m = $200m
• FDV → $2 × 1b = $2b
Same token and price, but 3 completely different vals

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Personal thoughts
• MMC/OTV is a healthier “reality” for tokens where circulating supply is artificially small (reduces the “low float = cheap” illusion)
• MC still matters most for trading purposes (only float can be traded)
• Although, MMC/OTV can still mislead if the minted supply is locked + “unspendable" (due to governance votes for example)