OTC liquidity
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Total supply refers to the total number of coins or tokens that exist in a cryptocurrency network. This includes all coins that have been mined, created, or issued, minus any that have been burned or destroyed.
Components of Total Supply
Circulating Supply
Circulating supply is the number of coins that are currently available in the open market and can be traded by customers. It excludes coins that are locked, reserved, or otherwise unavailable for trading.
Total-supply terminology: definitions for circulating, max, total, locked, burned, and lost coins
| Option | Definition |
|---|---|
| Circulating supply | Definitionnumber of coins available in the open market; excludes locked/reserved coins |
| Max supply | Definitiontotal number of coins that will ever exist; fixed cap |
| Total supply | Definitionall coins mined/created/issued minus burned/destroyed coins |
| Locked and reserved coins | Definitionnot included in circulating supply but part of total supply |
| Burned and destroyed coins | Definitionsubtracted from the total supply |
| Lost coins | DefinitionLosing access does not by itself remove coins from total supply; verifiably burned coins are excluded. |
| Mineable coins | Definitioncreated through the process of mining |
Max Supply
Max supply, or maximum supply, is the total number of coins that will ever exist in a cryptocurrency network. This is a fixed number and cannot be exceeded.
Mineable Coins
Mineable coins are those that can be created through the process of mining. Each new block added to the blockchain typically results in the creation of new coins.
Total Supply Includes Coins
Total supply includes all coins that have been mined, created, or issued, minus any that have been burned or destroyed. This gives a comprehensive view of the total number of coins in existence.
Market Capitalization and Competitive Prices
Market capitalization is calculated by multiplying the circulating supply by the current price of the coin. Competitive prices in the market can influence the market capitalization significantly.
Smart Contracts and Tokens
Smart contracts can create new tokens, which can be included in the total supply. These tokens can be used for various purposes, including as a medium of exchange or as a utility within a specific platform.
Example of Total Supply Calculation
For example, if a cryptocurrency has a max supply of 21 million coins, and 18 million have been mined, with 1 million burned, the total supply would be 17 million coins.
Factors Affecting Total Supply
Locked and Reserved Coins
Coins that are locked or reserved are not included in the circulating supply but are part of the total supply.
Burned and Destroyed Coins
Coins that have been burned or destroyed are subtracted from the total supply.
Lost Coins
Losing access to coins does not by itself remove them from total supply. Verifiably burned coins are excluded.
Conclusion
Understanding total supply is crucial for evaluating a cryptocurrency's market dynamics. It includes coins in existence, excluding those that have been verifiably burned or destroyed. By considering factors like circulating supply, max supply, and mineable coins, investors can make more informed decisions in the open market.
