Circulating Supply
Definition
The number of cryptocurrency coins or tokens that are publicly available and actively circulating in the market. Used with price to calculate market capitalization.
Circulating supply is the most commonly used metric for calculating a cryptocurrency's market capitalization (circulating supply times price). It excludes coins that are locked, reserved, or not yet released — providing a more accurate picture of the tradable market than total or maximum supply.
For example, Bitcoin has a maximum supply of 21 million coins, but the circulating supply is around 19.6 million (with the remainder yet to be mined). Some coins are also considered permanently lost (estimated at 3-4 million BTC), but these are still counted in circulating supply since there's no way to verify they're truly inaccessible.
The distinction between circulating, total, and maximum supply matters for valuation. A token with a low circulating supply relative to its total supply will face dilution as more tokens are released. If only 10% of tokens are circulating and the rest will be unlocked over two years, selling pressure from future unlocks could suppress the price.
Token unlock schedules — the timeline for releasing locked tokens — are critical information for investors. Venture-backed projects often have large portions of supply locked for 1-4 years post-launch. When these tokens unlock, insiders and VCs may sell, creating downward price pressure.
Fully Diluted Valuation (FDV) uses maximum supply instead of circulating supply for market cap calculation. Comparing FDV to circulating market cap reveals how much dilution remains. A project with $100M circulating market cap but $1B FDV means 90% of tokens haven't entered circulation yet.
Where this appears in Clarity
Clarity automatically tracks and calculates these concepts across your connected accounts.
Related Terms
Frequently Asked Questions
Why does circulating supply matter for crypto prices?
Circulating supply directly determines market cap (supply x price). A token with 1 billion circulating at $1 has the same market cap as one with 10 million circulating at $100. Increasing supply through unlocks or inflation dilutes existing holders and can suppress price growth.
What's the difference between circulating and total supply?
Circulating supply is what's currently tradable. Total supply includes locked, vesting, and reserved tokens. Maximum supply is the hard cap (if one exists). Bitcoin's circulating is ~19.6M, total is the same, and max is 21M. Some tokens have no maximum supply.