Total Supply

What Is Total Supply?

Total supply is the total quantity of coins in circulation today, excluding any coins that have been provably burnt. The total supply measure takes into account coins that have previously been minted or mined. 

Not every coin is listed in this metric are usable, and coins that have been burned are excluded. In contrast, circulating supply accounts for all tokens or currencies that have been mined and are available for usage. 

It excludes coins that can be created but have yet to be created. The market capitalization of a cryptocurrency is calculated using the circulating supply instead of the total supply. The former is usually more accurate because cryptocurrency prices are typically influenced by coins and tokens that can be used instead of those that cannot.

Further Understanding the Difference Between Total Supply and Circulating Supply

Total supply incorporates coins that have been locked as a product of either pre-mined coins that have been purposely kept out of circulation or tokens locked in smart contracts. Tokens can be locked in smart contracts until a certain goal is met, such as the completion of several stages of an ICO for a specific cryptocurrency. 

The total supply of a cryptocurrency can be an essential indicator of its profitability or whether investors should participate in it. A big disparity between circulating supply and total supply, for example, can have concerns for future profitability. Many new tokens on the market may put downward pressure on bitcoin values. Total supply cannot be utilized to calculate the maximum amount of tokens or coins that can be mined at any given time.

Difference Between Total Supply and Maximum Supply

Whereas the total supply includes all coins that have already been mined (or issued) except those that have been burned, the maximum supply refers to all coins that will ever be created. Unlike the total supply, the maximum supply comprises coins that have yet to be mined (in the future), also those that are included in the total supply and those that have been burned. 

Many coins are valued in crypto economics due to their fundamental scarcity. Bitcoin and other mineable money, for example, are created each time a new block is validated by a miner and then confirmed by the rest of the network. 

Nevertheless, the creation of new coins is not an infinite process, as most mineable cryptocurrencies include a cap (max supply) that restricts the number of coins that may be created. The maximum supply is typically determined at the time the genesis block is formed.