What is the difference between market cap and realized cap?

Market cap values every coin at the current market price, while realized cap values each coin at the price it last moved on-chain. The difference is that market cap reflects present speculative valuation, whereas realized cap reflects the aggregate cost basis of holders. For example, if a token's market cap is well above its realized cap, holders on average sit on unrealized gains; when the two converge, much of that paper profit has eroded. Analysts compare the two to gauge how stretched or grounded a valuation is.