In-depth essays · #24 / 50 · On-Chain Finance (DeFi), Stablecoins & RWA
Reading On-Chain Metrics Without Illusions: Market Cap, FDV, TVL, Stablecoin Supply, and TPS
How to separate genuine economic activity from low-float valuations and bot traffic
In Ethereum City, building heights reflect Market Cap or TVL, road lanes reflect TPS, and storefront lights reflect token transfer frequency. Yet any single metric read in isolation can mislead. Here is how to read the four core numbers of on-chain analysis together.
1. Circulating Market Cap vs. Fully Diluted Valuation (FDV)
Circulating Market Cap multiplies current token price by the supply actively trading today, whereas FDV multiplies price by the maximum total supply—including locked team, investor, and ecosystem allocations.
A token with only 5% of its supply unlocked may look small by circulating market cap while carrying a massive FDV and years of upcoming unlock supply.
2. Total Value Locked (TVL) vs. Stablecoin Float and DEX Volume
TVL measures the dollar value of assets deposited in a chain’s DeFi contracts—and determines building height in Ethereum City for tokenless L2s like Base. Pairing TVL with on-chain stablecoin supply (USDT, USDC) reveals whether capital is sticky, liquid cash or simply appreciating governance tokens.
3. Transactions Per Second (TPS): Counting Cars vs. Weighing Freight
High TPS shows strong technical throughput and busy roads, but raw transaction counts treat a sub-cent bot ping the same as a $50 million institutional settlement or an L2 batch anchoring thousands of user trades on Ethereum L1.
4. Why Ethereum City Layers All Four Metrics onto One Map
By combining skyline height (Market Cap / TVL), road traffic (TPS), bridge buses (L1 deposits), and shop activity (token transfers) in one view, Ethereum City lets you cross-check every headline number at a glance.
Related districts in the city
Related glossary terms
This essay is an explainer written to help you read the city; it is not investment advice. Facts on this page are as of 2026-10 and may change. If you spot a mistake, please tell us through the contact page.