A good article for those who scream "But..but.. market cap"


#1

Ever wonder how much money there is in the world?

The answer is complicated, which you might expect, but not because of the difficulty of tallying up all the rather large numbers. Rather, it’s more about which parameters are used to define “money.”

“The amount of money that exists changes depending on how we define it. The more abstract definition of money we use, the higher the number is,” said Jeff Desjardins, an editor of Visual Capitalist, who put together an infographic to answer this question back in 2015 and recently updated it as money continues to take on a different meaning.

“Are the abstractions created by Central Banks really money? What about gold, bitcoins, or other hard assets?” he asks.

For purists, who believe “money” refers only to physical “narrow money” (bank notes, coins, and money deposited in savings or checking accounts), the total is somewhere around $36.8 trillion. If you’re looking at “broad money,” which isn’t just physical money and includes any money held in easily accessible accounts, the number is about $90.4 trillion.

But for those preferring an even broader interpretation, including bitcoin BTCUSD, +5.69% , ethereum and other cryptocurrencies, plus above-ground gold supply, and funds invested in various financial products like derivatives, the amount is in the quadrillions.

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This is what a quadrillion looks like written out: 1,000,000,000,000,000.

Funds invested in derivatives alone total at minimum $544 trillion, and the high-end estimate is $1.2 quadrillion. In fact, there is more money in derivatives than in all the stock markets combined, which is a comparatively paltry $73 trillion. The U.S. accounts for the biggest slice of that global market cap pie, thanks to companies like Apple Inc. AAPL, +1.03% , Alphabet Inc. GOOGL, +1.67% and Microsoft Corp MSFT, +1.73%

Investment in commercial real estate, often the most visible symbol of wealth, pales in comparison to stocks or derivatives at $29 trillion.

As for money owed by every single person and country in the world, the grand total is $215 trillion, with some 33% of it borrowed in the last decade.

And despite an explosive year for bitcoin and other cryptocurrencies, as an asset class, crypto clearly has a long way to go. The value of all bitcoin in circulation is estimated in this graphic at $100 billion (bitcoin’s market cap is now over $160 billion, according to CoinMarketCap). That’s a staggering rise from the tiny dot bitcoin represented on the 2015 version of this graphic… but, still, a proverbial drop in the bucket


#2

Nice, I like this graphic from Demonocracy.info


#3

Thanks for grabbing that … it is a great tool for thinking in abstraction layers , like fp is. !!

I think pictures like these can help people understand how cardano , being “an open source value play” , seeks the lowest cost , like any competitive venture would … and still we see a very very very high value … it is exactly like the question of why aren’t blockchains going to take over the governments like people thought the internet would or free speech would … The answer is, the blockchain will BE THERE to help the government realize more free-ness frictionless value , and that THAT will help all of us to gain more so to speak , benefits.


#4

Great read… I can’t help but wonder, what would happen if these guys started an ada staking pool?


#5

Not sure what mechanisms can be implemented to prevent this. Worst case, these 50 guys would destroy the confidence for exactly the system they put so much money in.


#6

Yeah I wonder sometimes too about a POS coin being vulnerable to the 51% attack on assets … I feel like I haven’t thought it through enough yet. I wouldn’t want a so to speak hostile take over attack to occur through a central bank for example … But , with the idea of the “calmer” “merger/absorption” being so much more beneficial to both parties, I think that confers some attribute of protection to cardano… Also the voting system may be a key redoubt so to speak . I have confidence in the team because they explicitly are using knowledge learned from the first dao attack a few years ago.


#7

Yeah, I also think they are working on this and figuring out ways to distribute the voting power so that it will be very difficult for countries or wealthy investor pools to take over the direction of the currency. I think Cardano has a good potential to be used by nation states as official currency, but I hope it is less susceptible to the type of economic espionage and destruction that currently happens between powerful nations.