The difference between inflow and market cap and how it relates to Tethers.

One thing I often see on the crypto forums and sub reddits among newer investors is the confusing of market cap with the amount of money invested in crypto. It seems most people think that if the crypto market cap is $700 billion, that means that $700 billion has been invested in crypto, but this is incorrect, and in fact the real numbers are very far apart. So confusing these two figures really distorts your perception of the market and the impact of certain factors around the marketplace.

For example, let’s look at the Tether scam and how Tethers were used to artificially inflate the price of BTC. Most people look at the market cap and say Tethers are such a small percentage of that so it should have no real impact. However, when we look at net inflow, the actual money invested into crypto, the total is only $10 billion as we estimated earlier. This means that Tethers could be responsible for as much as 20% of the current market cap! The implications of this would be catastrophic for the overall markets if this were true.