Market Capitalization, or Market Cap Market Capitalization, or Market Cap The term market capitalization comes from the world of equities and is determined by multiplying the total outstanding shares of an asset by the last available share price. The term has been adopted for use in the digital asset space and is computed by multiplying the total coin supply by the current market value of each coin. Some prefer the term implied network value, as the coins are digital assets of decentralized networks rather than shares in a company.

Maximum Coin Supply Maximum Coin Supply This is the total number of coins that can be minted for a particular digital asset. Most digital assets have been designed with caps on the total supply that can be created by the network in an attempt to drive value by creating digital scarcity. A digital asset's maximum coin supply is a fundamental feature of its design, and some have no fixed maximum supply at all. Bitcoin's maximum coin supply is set at 21 million.

mBTC mBTC A bitcoin can be split into very small parts. Each bitcoin is divisible to the eighth decimal place, so each bitcoin can be split into 100,000,000 units (satoshis). An mBTC is one thousandth of a bitcoin, or 0.001 BTC. It is also called a millibitcoin. See also uBTC and Satoshi.

Merkle Trees Merkle Trees A Merkle tree is a binary tree data structure in which a set of data can be compactly committed to so that it cannot be modified. It works by hashing together pairs of data (leaf nodes), hashing the pairs of the pairs from that hashing and so on, in pairs, until there is a single hash remaining. This is known as the Merkle Root and is a compact commitment to the entire set of data. Most digital assets use Merkle Trees to ensure that the set of transactions in a block are unmodified. A Merkle Tree also has a feature where by presenting a list of hashes which indicate a branch of the tree, a single element can be proven to be present in the tree. This is the fundamental tool used by Satoshi Nakamoto in his “Simple Payment Verification” (SPV) proposal. See Light Client .

Mining Mining Mining is the method by which digital assets such as Bitcoin and Ethereum are minted and released into circulation. Mining is also the method by which transactions are incorporated into the blockchain. Finally, mining provides a mechanism to cause the unit of account to acquire a cost of production, which causes the blockchain to become a financial asset and not just a database entry. Miners perform all the same duties as nodes, and additionally attempt to solve a proof-of-work puzzle that, given a successful solution, gives them the right to publish a block of new transactions and allocate new coins to themselves. They do this by computing a hash repeatedly with different inputs, creating a proof-of-work algorithm. Mining is competitive and requires powerful dedicated hardware, energy consumption, and time.

Mining Pool Mining Pool Due to the variance of whether a given miner will win a block or not, miners often band together into mining pools. In a mining pool, one node validates transactions and distributes a candidate block to multiple different miners. By agreeing to share winnings if one of the miners in the pool wins the block, pools help reduce variance for its members.