How to understand a market-cap-to-FDV gap

What a market-cap-to-FDV gap is

A market-cap-to-FDV gap is a large difference between a token's circulating market cap and its fully diluted valuation. Learning to understand it is about building the mental model of how it actually works.

The signals that matter

When you are understanding a market-cap-to-FDV gap, these are the concrete signals to focus on:

• Circulating supply far below total supply
• Scheduled unlock cliffs
• Large locked team allocations
• A low mcap headline beside a huge FDV
• A live mint authority that can grow supply

Where to look

You will mostly observe a market-cap-to-FDV gap in the circulating vs total supply figures and the vesting schedule. To understand it, go straight to these sources rather than relying on chat or hype.

To understand it: the steps

1. Learn the mechanism behind it, not just the symptom.
2. Map how each signal connects to that mechanism.
3. Walk through a concrete example end to end.
4. Test your model against a live case to confirm it holds.

The mistake almost everyone makes

Turning the read into action

Once you can read a market-cap-to-FDV gap, the bottleneck becomes attention: you cannot watch every chart 24/7. This is where automated alerts earn their keep — software watches the on-chain conditions and notifies you, so you act on a fresh signal instead of a stale glance.