Supply

What is Supply in Crypto?

Supply in cryptocurrency refers to how many tokens or coins exist. Understanding supply metrics is crucial for evaluating a crypto asset’s scarcity, potential inflation, and fair value. There are three main supply measures to understand.

Three Types of Supply

1. Circulating Supply

Tokens currently available in the market:

• Actively traded
• Held by public investors
• Not locked or restricted

2. Total Supply

All tokens that currently exist:

• Circulating supply + locked tokens
• Includes team holdings, staking, reserves
• Excludes burned tokens

3. Maximum Supply

The cap on tokens that will ever exist:

• Hard-coded limit (like Bitcoin’s 21M)
• Some tokens have no max (inflationary)
• Others burn to become deflationary

Supply Comparison Example

Metric	Bitcoin	Ethereum	Dogecoin
Circulating	~19.5M	~120M	~143B
Total	~19.5M	~120M	~143B
Maximum	21M	Unlimited*	Unlimited

*Ethereum has net deflationary periods due to burning

Why Supply Matters

Price Impact

Market Cap = Circulating Supply × Price

Lower supply with same demand = higher price per unit.

Inflation Risk

• New tokens entering circulation dilute value
• Check emission schedule before investing
• High inflation can offset price gains

Scarcity Value

• Fixed supply creates scarcity (like Bitcoin)
• Unlimited supply requires demand growth to maintain value

Supply-Related Events

Halving

• Bitcoin rewards cut in half every ~4 years
• Reduces new supply entering market
• Historically bullish for price

Token Unlocks

• Vesting schedules release locked tokens
• Can create selling pressure
• Check unlock schedules before buying

Burns

• Tokens permanently destroyed
• Reduces total supply
• Can be deflationary mechanism

Analyzing Supply for Investment

Questions to ask:

1. What % of max supply is circulating?
2. When are major unlock events?
3. What’s the inflation rate?
4. Are there burn mechanisms?

Check supply data on exchanges like Coinbase and Binance, or tracking sites like CoinGecko.