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What is Circulating Supply?

· Editorial Team · · ~4 min read

Circulating Supply — The quantity of a cryptocurrency currently in public hands and tradable on exchanges, distinct from total supply and max supply.

How It Works

01 Circulating supply counts coins that have been mined or issued and are freely tradable.
02 It excludes tokens locked in team vesting, treasury, staking contracts, or burned addresses.
03 Data providers track on-chain data to estimate circulating supply, though methodologies vary.
04 Changes in circulating supply (inflation, unlocks, burns) directly affect price discovery and market cap.

Why It Matters

▸ Circulating supply determines market cap, the primary ranking metric for cryptocurrencies.
▸ Tokens with large scheduled unlocks can dilute value, even without new demand.
▸ Deflationary mechanisms (burns) reduce supply, potentially increasing scarcity and price.
▸ Understanding supply schedules helps investors forecast price pressure.

Common Questions

What is the difference between circulating supply and total supply?

Circulating supply excludes locked/vested tokens; total supply includes all coins that exist, including those not yet tradable.

What is max supply?

Max supply is the hard cap on coins that will ever exist. Bitcoin max supply is 21 million; Ethereum has no max supply.

How often does circulating supply change?

Continuously. Proof of Work coins issue new coins per block; staking coins issue inflation; burns reduce supply. Vesting unlocks also increase circulating supply.

Why does Bitcoin have a fixed supply?

Bitcoin code caps supply at 21 million coins, with issuance halving roughly every 4 years. This scarcity is a core value proposition.

References

  1. https://www.coingecko.com/en/glossary/circulating-supply
  2. https://www.coinmarketcap.com/acadory/article/circulating-supply
  3. https://www.investopedia.com/terms/c/circulating-supply.asp

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Educational content · Not financial advice · Trade at your own risk