Market capitalisation is the total value of an asset, found by multiplying its price by the number of units outstanding — circulating supply for a coin. It answers "how big is this?" in a way the per-unit price never can, which is why assets are ranked by market cap rather than by price.
The per-unit price in isolation is almost meaningless for comparison, because two assets can carry wildly different prices yet similar total values depending on how many units exist. A low nominal price does not make something "cheap", and a high one does not make it "expensive".
Market cap is a useful first measure of size and relative weight, but it is blunt. It does not reveal how much real money has flowed into an asset, how liquid it is, or whether the price is justified — a thinly traded asset can show a large cap on very little actual buying.
Worked example
A coin at $0.01 with 100 billion units has the same $1 billion market cap as a $1,000 coin with one million units.
Related guides
This definition is general education, not investment advice. Markets — especially crypto — are volatile and you can lose money. Please read our disclaimer and see our methodology.