Total Crypto Market Cap vs S&P 500's Biggest Companies

in #cryptocurrency3 years ago (edited)

With bitcoin working its way into the mainstream and many other cryptos growing as well, I’d like to quickly look at the market cap of all combined cryptocurrencies in comparison to companies in the S&P 500 index, which is made up the US stock market’s biggest 500 companies measured by market capitalization.

Below is the top 5 S&P companies followed by market cap, including the combined market cap of all cryptos. Measured in USD

1. Apple-$892 billion
2. Google-$741.88 billion
3. Microsoft-$670.01 billion
4. Total Cryptocurrencies-$591.94 billion
5. Amazon-$568.15 billion
6. Facebook-$523.57 billion

This gives you a good idea of just how big the crypto space has grown to. To keep it in perspective though, the Forex(currencies) market sees daily trading volume between 3-5 trillion dollars per day, depending on how it is measured. The Forex is both the biggest and most liquid market in the world. Since crytpo’s are obviously classified as a currency and not as a company, the comparison to the biggest stocks in the S&P is not exactly an apples to apples comparison, rather it shows the level of market activity in two different assets.

The basic implications are that all of the money that has been flowing into the crypto space is money that DIDN’T flow into other assets such as stocks, bonds, real estate, precious metals, commodities, etc. While the specifics are impossible to truly measure, we can safely deduce that other asset classes must necessarily be squashed of potential gains due to more of the action being in cryptos. This could even be the case for an asset that has been rising anyways regardless of the increasing popularity of cryptos, such as the US stock markets which have been routinely setting all-time highs this year. Those highs could have been even higher if more money had flowed into stocks. Assets like gold and silver could have gone much higher if investors had shown more interest in them rather than cryptos. Of course, it’s impossible to say for certain how billions of human actors would have behaved, and thus affected the price of certain assets.

*This post is not intended as financial advice. It is for informational purposes only.

Sources:
https://coinmarketcap.com/
https://www.reuters.com/article/global-forex-volumes/daily-fx-trade-more-like-3-trillion-than-5-cls-idUSL5N1GK1F5
http://dogsofthedow.com/largest-companies-by-market-cap.htm

Sort:  

To keep it in perspective though, the Forex(currencies) market sees daily trading volume between 3-5 trillion dollars per day, depending on how it is measured.

That does put it in perspective, haha. Goes to show how far we have to run with crypto. However, makes you wonder if the 500 or so billion from crypto would have gone into stocks this year.

Not only what you said above about money not flowing into other asset classes because it was going into crypto, but while cryptocurrencies have been rallying over the past weeks, money has been coming out of the technology sector, one of the best performing and most speculative sectors of the market. It might be a coincidence, but it could also be tech investors taking some profits and moving into crypto.

Good point, I wouldn't doubt that tech people are moving into crypto but this could also benefit the tech sector of the stock market as more and more bitcoin-related companies become publicly traded, along with bitcoin ETFs that are being attempted by various institutions/investors. The NASDAQ especially should benefit from bitcoin-related startups.

I hope you realise that a 0.7% drop in the US stock market resembles a complete Bitcoin wipe out to $0. The crypto market is just peanuts in comparisation to the stockmarket...

This is true, but I'm trying to emphasize the fact that the total crypto market cap has grown from 14 billion one year ago to 591 billion today.

Great post!

perfect. thanks for sharing :)

very useful comparison!

Coin Marketplace

STEEM 0.16
TRX 0.03
JST 0.026
BTC 13107.59
ETH 413.60
USDT 1.00
SBD 1.00