Circulating Supply
The number of coins or tokens that are actually out in the wild and available for trading right now. Multiply it by the price and you get market cap.
When you see a cryptocurrency's market cap, it's calculated using circulating supply—the tokens that are actually tradable right now. This number leaves out coins that are locked up, reserved by the team, or haven't been released yet, giving you a more realistic picture of the market.
Take Bitcoin as an example. Its maximum supply is capped at 21 million coins, but only about 19.6 million are currently circulating (the rest haven't been mined yet). An estimated 3-4 million BTC are probably lost forever—but they still count toward circulating supply since there's no way to prove they're gone.
Why does this matter for your portfolio? A token with a small circulating supply relative to its total supply is facing future dilution. If only 10% of tokens are out there now and the rest unlock over two years, all those new tokens hitting the market could push the price down.
Pay attention to token unlock schedules—the timeline for releasing locked tokens. Venture-backed projects often lock large chunks of supply for 1-4 years after launch. When those tokens unlock, insiders and VCs may sell, which can create real downward pressure on price.
You'll sometimes see "Fully Diluted Valuation" (FDV), which uses the maximum supply instead of circulating supply. Comparing FDV to the current market cap tells you how much dilution is still ahead. A project with a $100M market cap but $1B FDV means 90% of tokens haven't entered circulation yet—that's a lot of potential selling pressure down the road.
Frequently Asked Questions
▸Why does circulating supply matter for crypto prices?
It directly determines market cap (supply times price). A token with 1 billion circulating at $1 has the same market cap as one with 10 million at $100. When supply increases through unlocks or inflation, your share gets diluted—kind of like a company issuing more stock.
▸What's the difference between circulating and total supply?
Circulating supply is what you can actually trade right now. 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 at all.
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