Hello! I have gotten my self confused so need help unsticking myself. I am making a javascript calculator that aims to illustrate the relative value of an item. Below is my reasonign and current state of my calculator... BUT Am I correct? I'm doubting my logic.
This calculator relates to Cryptocurrency, a common misunderstanding of the value of a cryptocurrency comes from market supply. The reason that BitCoin is so valuable is that it is limited in supply. Dogecoin however, has loads more supply, so can never get to the same value. The idea of this calculator is to illustrate this fact, by "levelling the playing field". Imagine all cryptocurrencies had the SAME supply as bitCoin, (18,705,975), how would it effect the current price Here is a chart to illustrate:
Market Cap is Current price x circulating supply so If i take the current price and x 18,705,975 (levelling the supply to be the same as bitcoin) I should now have a price that has been levelled... Is this correct so far? In our example above, this means Dogecoin would be worth $4100.78 given its circulating supply was the same as bitcoin.
So I want to now take this further, and show relative value - because supply IS DIFFERENT I need to now show if a certain cryptocurrency became an equally traded cryptocurrency as BitCoin, what would the top value become. So I have a levelled price, I *think* what I need to do is take the levelled price and find the difference in percentage between the bitcoin price and the levelled alternative cryptocurrency price. I need to find a percentage increase, to get it to 69,655.19 (current bitcoin price above) and then use this percentage increase on the current crypto price (0.5968 in example for doge above) so here the solution would be :
0.5968 x 94.08 = $56.14
So If Dogecoin was the worlds most popular cryptocurrency, with the same trading volume as BitCoin it would be worth $56.14
How would I express what I need to do mathematically, or is a better option available to do what i need? and most of all Is my logic correct?!
Thanks to anyone who decides to help!
This calculator relates to Cryptocurrency, a common misunderstanding of the value of a cryptocurrency comes from market supply. The reason that BitCoin is so valuable is that it is limited in supply. Dogecoin however, has loads more supply, so can never get to the same value. The idea of this calculator is to illustrate this fact, by "levelling the playing field". Imagine all cryptocurrencies had the SAME supply as bitCoin, (18,705,975), how would it effect the current price Here is a chart to illustrate:
Market Cap is Current price x circulating supply so If i take the current price and x 18,705,975 (levelling the supply to be the same as bitcoin) I should now have a price that has been levelled... Is this correct so far? In our example above, this means Dogecoin would be worth $4100.78 given its circulating supply was the same as bitcoin.
So I want to now take this further, and show relative value - because supply IS DIFFERENT I need to now show if a certain cryptocurrency became an equally traded cryptocurrency as BitCoin, what would the top value become. So I have a levelled price, I *think* what I need to do is take the levelled price and find the difference in percentage between the bitcoin price and the levelled alternative cryptocurrency price. I need to find a percentage increase, to get it to 69,655.19 (current bitcoin price above) and then use this percentage increase on the current crypto price (0.5968 in example for doge above) so here the solution would be :
0.5968 x 94.08 = $56.14
So If Dogecoin was the worlds most popular cryptocurrency, with the same trading volume as BitCoin it would be worth $56.14
How would I express what I need to do mathematically, or is a better option available to do what i need? and most of all Is my logic correct?!
Thanks to anyone who decides to help!