# EAMC₁: A New Metric for AMM-Based Markets

By el1gma · 2026-10-19
Canonical: https://el1gma.com/posts/exit-adjusted-market-cap

I think the space could benefit from an additional metric for AMM-based markets.

Market caps are often taken at face value as an indicator of how large a project is, as a pseudo-indicator of how much a holder can get out of the project by selling his tokens.

Market capitalization values circulating supply $$S$$ at the current token price $$p_0$$:

$$
\mathrm{MC} = p_0 S
$$

Holder distribution is probably the next most useful metric, though it's harder to capture in a single number.

So in this short WIP article, I'll suggest the first step towards an additional metric to indicate the size of a project, not to be considered as a replacement for market cap.

The proposal here is what I would call an Exit-Adjusted Market Capitalization, shortened as EAMC.

The intention is to get an indication of what the market cap looks like after an $$n\%$$ sell, which is very helpful in volatile markets.

We'll add a subscript to EAMC indicating the percentage of circulating supply being sold.

## A fixed 1% reference

I suggest we will default to a 1 % sell off, as that is often very likely, it's easy to assess the likelihood by looking at the top holders, and if the impact is severe at 1 %, it's a good indicator of an inflated market cap.

Let $$Q(0.01S)$$ be the proceeds from that sale and $$p_{\mathrm{avg}}$$ its average execution price:

$$
\mathrm{EAMC}_1 = S\,p_{\mathrm{avg}} = \frac{Q(0.01S)}{0.01}
$$

Using a fixed 1% reference provides a consistent sale size relative to supply for comparisons.

## Example

Consider a hypothetical token with a $26 million MC and a single full-range constant-product pool holding $330,000 in total liquidity.

The quote side holds $165,000. Assume a $1 quote asset and exclude transaction costs/fees.

Selling 1% of circulating supply has a current marked value of $260,000 and returns approximately $100,941 through this pool:

$$
\mathrm{EAMC}_1 = \frac{\$100{,}941}{0.01} \approx \$10.09\text{ million}
$$

| MC | EAMC₁ |
| ---: | ---: |
| $26 million | $10.09 million |

MC uses the current marginal price; EAMC₁ uses the average execution price of the defined sale. The seller receives about $100,941. EAMC₁ expresses that execution price across the circulating supply, rather than total withdrawable funds.

For comparable readings, use consistent liquidity coverage and record the supply source, quote asset, and timestamp. EAMC₁ adds a liquidity reference to MC; it does not measure intrinsic value.