A good analogy is comparing the advertised price of a used car versus what you actually get for it. You might think it's worth $5k, but there's only 1 person who wants to buy it and they're only willing to pay $4k, so it's actually worth $4k, not $5k. It doesn't matter if someone else sold theirs for $5k.
I don't think anybody is claiming the number on Coin Market Cap is the actual market value because it is simply a metric derived from aggregating across multiple, very volatile exchanges.
EDIT: ok i saw your comment below, and it seems you are arguing, albeit very aggressively, that daily market fluctuations are random and cannot be attributed to an actual event, such as this one?
It's a metric, one as "untrue" as an average or median. It's not a contract, and you won't get that if you change the market, which selling and buying does.
I don't think that means we shouldn't use it as a metric to use to get information from for comparisons. And I don't think that it's bad journalism to say that the market cap dropped by $100B when it did, even if that doesn't equate to $100 billion being burned.
This is true regardless of whether we're talking about Bitcoin, stocks, metals, houses, chickens, or seashells.
Most of these stupid market movement predictions are equivalent to astrology and only exist because WSJ and others have nothing interesting to say. The daily market fluctuations are pretty much random, and this has been proven many times over.
It is used like a unitless measuring stick, not a prediction on what you can get if you sold.
And I'll argue that it does it's job fairly well. It's difficult to "game", and can help give you some information about an asset. It doesn't say everything, it can't tell you if it's stable, or if it's being used or not, or if it's a scam. It's just a tool, a metric, something that you use with a bunch of other tools to get an idea of the ecosystem.
I would be happy to "rename" it to a unitless value that doesn't imply a "total worth", but that ship has sailed, and it's not going to be possible, so we have what we have.
https://www.investopedia.com/terms/m/marketvalue.asp
Market value definition:
> obtained by multiplying the number of its outstanding shares by the current share price
The reality of selling has nothing to do with it. It's just a math equation.
Also investopedia isn't exactly a high quality source.
"Market capitalisation or market cap is the market value of a company's issued share capital – in other words. the number of shares multiplied by the current price of those shares on the stock market."
Net worth is the same concept. Jeff Bezos net worth is calculated based on how much his assets are theoretically worth based on current fair market prices. He doesn't have to sell all his assets to determine his net worth.
People don't like the "lost $100B in market value" part, but it is accurate since market value is calculated on paper.
In the stock market, if a company has ten million shares at $100 each we say the company is worth a billion dollars, even though that $100 price is only the most recent transaction. We say that because if price times quantity didn't match what the overall market thinks the whole company is worth, the price would quickly correct until it did.
Market value is exactly what the parent asserted it is, and the source of truth for that is your bank. If you are long 500k shares of AAPL and the quote is $100 - your bank will not consider you to have $50mil liquid assets. They know(and you should to) that starting to unwind a position of that size will decrease the market value a considerable amount.
Maybe an example will help you out here.... Let's walk through that AAPL example. You are sitting on 500k shares.
Step 1: Order 100,000 shares sold at market.
Step 2: Observe your average sale price is more likely to be $90-95 than $100.
Step 3: Order another 100,000 shares sold at market.
Step 4: Observe your average sale price is more likely $90-91 than $90-95.
Steps after this: same result, diminishing prices resultant from your sale(s).
See a trend here? The market value of your assets is decreasing based on the market's perception of value, not on the mechanical formula investopedia fed you. Your unloading of shares is going to decrease the perceived value, which decreases the price you can sell them for.
tldr; investopedia's advice on markets is barely more accurate than urban dictionary's advice on word meaning.
So as crazy as it sounds $100B in market value can be erased by a drop in the market price of an asset. But don't confuse that with $100B actually being lost or investors realizing $100B in losses. But in any event the title of the article is accurate.
Apple traded 21,583,997 shares today. Aggressively selling 500,000 shares (less than $100 million dollars worth) might move the market in this stock by perhaps 1%, certainly not anywhere near 10%.