FDV / TVL

This applies the fully diluted supply assumption to the deposits comparison, pricing every token that will eventually exist against the capital currently held in the protocol's contracts. It is most often used for young protocols where a small circulating float sits alongside a large deposit base built with token incentives. The gap between this and the market-capitalization version is entirely a function of how much supply remains unissued.

How it is computed

(price x fully diluted token supply) / total value locked

Where it misleads

It inherits every problem of both inputs at once: recursive double-counting in deposits and an undefined or provider-specific diluted supply. Protocols that attracted deposits with token emissions are the common case here, and those same emissions are what inflate the diluted supply, so the two sides of the ratio are causally linked rather than independent. Deposits denominated in the protocol's own token make the denominator partly reflexive with the numerator. For chains with no maximum supply the numerator is a substitute quantity, not a measurement.

The equity comparison, and why it fails

Fully diluted price-to-book. The analogy fails because there is no book, no audit, and no residual claim, and because the diluted token count is set by code and governance rather than by instruments disclosed in a filing.

Reading a high or a low value

A high value means the eventual full token supply is priced at a large multiple of current deposits; a low value means the reverse. The measure is most sensitive to supply-schedule definitions, so figures from different providers should not be compared directly.