TL;DR
FDV is the theoretical market cap if all tokens that will ever exist were in circulation at the current price, calculated as price × maximum supply.
Market cap uses circulating supply; FDV uses total or maximum supply. A token priced at $1 with 10M circulating tokens has a $10M market cap. If total supply is 100M tokens, FDV is $100M. The gap between market cap and FDV represents tokens that are locked, vesting, or not yet minted. A large gap means significant dilution risk as those tokens eventually enter circulation.
A token can look cheap by market cap but expensive by FDV. If a project has $5M market cap but $500M FDV, there’s potentially $495M worth of tokens that will eventually be sold or distributed. Team tokens, investor allocations, and ecosystem funds all contribute to this. Savvy traders check FDV to understand the true cost of a project relative to its potential future sell pressure.
Most Pump.fun memecoins have all supply circulating from the start (no vesting, no team allocation), so market cap equals FDV. This is actually a feature — it means no hidden supply overhang. When comparing a memecoin to a VC-backed token, comparing their FDVs gives a more honest picture than comparing market caps alone.