FDV vs Market Cap: What "Low Float, High FDV" Means and Why It Matters

Two numbers are quoted for almost every token, and they can differ by a factor of ten or more:

• Market cap = price × circulating supply. The value of the tokens that can trade today.
• Fully diluted valuation (FDV) = price × total or maximum supply. The value if every token that will ever exist were already circulating at today's price.

If a token has 100 million circulating out of a 1 billion maximum and trades at $1, its market cap is $100 million and its FDV is $1 billion.

What "low float, high FDV" means

Float is the share of supply actually available to trade. A low-float, high-FDV token is one where only a small fraction circulates, so the market cap looks modest while the FDV is very large. In the example above the float is 10%.

It matters for two separate reasons.

1. The price is set by a small amount of supply

With little supply on the market, a modest amount of money can move the price a long way, or hold it up. A headline valuation built on a thin float has not been tested by much real selling.

2. The rest of the supply is on its way

The other 90% belongs to someone: team, investors, a treasury, future rewards. Most of it is on a release schedule. As it unlocks, the circulating supply grows, and if demand does not grow with it the price has to fall for the market cap to stay the same. See token unlocks explained.

Why the numbers themselves need care

• Circulating supply is often self-reported. Data sites generally rely on figures supplied by the project. Tokens counted as circulating may be sitting in team-controlled wallets.
• FDV assumes today's price holds. It is an arithmetic product, not a forecast. Nobody could sell the whole supply at the current price.
• Some tokens have no maximum. For a token with ongoing emissions or a mint function, FDV based on current total supply understates future dilution.
• Burned and locked tokens blur it. Supply sent to a burn address may or may not be subtracted, depending on the site.

A low float is not automatically a problem

Every new token starts with a low float; supply has to be released over time somehow. A project a few months old with a published multi-year vesting schedule is in a normal position. The combination that deserves attention is a small float together with concentrated holdings among the tokens that do circulate, because then a few wallets control the part of the supply that sets the price.

How FraudCoins uses it

Our risk score includes a supply-structure factor based on how much of the total supply is in free float, and a separate, measured factor for on-chain holder concentration: the share held by the ten largest private wallets after exchange, treasury, pool and burn addresses are set aside. The first is an estimate from reported supply. The second is read from the chain, and each coin page says which wallets were excluded. The full weighting is on the methodology page.

For any single token, three checks cover most of it: the market cap to FDV ratio, the unlock schedule, and who holds what is already circulating. The last one you can measure yourself with the token holder checker.