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2023/08/19 15:46

Total Supply vs Circulating Supply vs Max Supply ?

Difference Between Total Supply vs Circulating Supply vs Max Supply ?

Total Supply, Circulating Supply, and Max Supply are crucial concepts in the world of cryptocurrencies, each offering distinct insights into a digital asset's characteristics.

Total Supply : This refers to the overall quantity of coins or tokens that a cryptocurrency protocol has the potential to generate. It encompasses all coins that have already been mined and those yet to be mined. However, it might include coins that are locked, unreleased, or reserved for various purposes. Total Supply provides a broad view of the asset's potential availability.

Circulating Supply: This represents the number of coins or tokens that are currently accessible and actively circulating in the market. It excludes coins held in reserve, locked, or otherwise not available for trading. Circulating Supply gives a more accurate reflection of the asset's liquidity and how much is readily tradable.

Max Supply : Max Supply is the upper limit of the number of coins or tokens that will ever exist within a cryptocurrency's protocol. Once this limit is reached, no more coins will be created. Max Supply sets an ultimate cap on the availability of the asset and plays a role in determining its scarcity and potential long-term value.

Understanding the distinctions between these supply metrics is essential for evaluating the market dynamics, investment potential, and fundamental attributes of a cryptocurrency. 

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