Because market cap is nonsense, if I create FooCoin with 1,000,000 tokens and sell one for $250, it has a market cap of $250M despite only ever having $250 in real money involved.

I know market cap isn’t sensible for coins with varying values, but for stablecoins equal to $1 market cap is supposed to be the number of tokens in circulation and therefore should be close to reserves.

Number of reserves is its own issue but only having 0.1% reserves is miniscule.

Take this line of reasoning further and you reveal the problem with crypto to crypto taxation.

Why? When you sell you make a profit or loss, same as any other asset.

Sounds like a statistical fluke to me (or some kind of market cap manipulation scheme). This token was not that liquid and not that widespread at all. I never heard of this token until today and I spend several hours a day on crypto.

That was the exploit. 248 million tokens were minted on $250k collateral.