If you take the time to read this article, you will learn three important things:
(1) Why cryptocurrency "Market Cap" is broken;
(2) How to fix the "Market Cap" (actually, what to replace it with);
(3) How to resolve the violent volatility that is holding back all cryptocurrencies from becoming truly stable currencies for real-world commerce.
The primary problems with crypto market cap are: (1) Data providers don't differentiate between circulating vs. locked coins, (2) Lost coins are still counted, (3) Last traded unit price dramatically over-inflates market cap.
Is Crypto Market Cap Useful At All? Yes, but in the same way that the Dollar Index is useful to observe the rise and fall of the percentage change in the value of the USD based on an arbitrary starting value. However, all the exchanges would need to come together and agree to abandon the idiotic market cap delusion and simply set a specific starting index date and a specific starting coin price for each coin and then present their data as an index value for each coin, not a market cap.
The Exchange-Value Stabilization Effect of Real Commerce. The reason the USD's value is not violently floating all over the map like cryptos is because the USD is constantly used as an actual medium of exchange in actual commerce. The process of constant commercial exchange imposes discipline on the pricing action in the USD currency market.
The Crypto Currency Markets Are NOT Functional Markets. Until cryptos are used much more frequently in actual commerce, the volatility of cryptos will continue to remain high. But the volatility is what prevents people from feeling confident enough to use cryptos in commerce more frequently in the first place. So, we have a chicken-and-egg problem.
Bottom Line: Until/unless a nascent crypto market is systematically developed in a highly coordinated way between a crypto project's team and many crypto-accepting merchants to overcome the "complementary products" chicken-and-egg problem, we will probably never see any cryptocurrency become stable enough to use in real-world commerce. This is exactly why we are implementing the Gini Ecommerce Portal, which is intended to maximize Gini's price stability in a way that no other cryptocurrency can achieve today.