Circulating Supply
Circulating Token Supply
Number of tokens publicly available and actively trading
Definition
Circulating supply refers to the number of tokens that are publicly available and actively trading in the market, excluding locked, reserved, or burned tokens.
Circulating Supply (Circulating Token Supply) is a token design term used to understand Number of tokens publicly available and actively trading. In practice, it matters because it affects how users evaluate protocols, compare opportunities, and avoid hidden assumptions.
Example
A project might have a total supply of 100 million tokens, but only 60 million in circulating supply due to team locks and reserves.
How it works
In practice, the concept shows up like this: A project might have a total supply of 100 million tokens, but only 60 million in circulating supply due to team locks and reserves.
Why it matters
Circulating Supply matters because small misunderstandings in DeFi can turn into bad pricing, liquidation, governance, custody, or smart-contract risk. A good mental model helps you compare protocols without relying on marketing language.
What to check
Treat it as a token-design concept: inspect supply mechanics, holder incentives, redemption paths, and governance controls. The main checks are: Supply inflation; Unlock events; Calculation differences.
Risks to Consider
- Supply inflation
- Unlock events
- Calculation differences
Common Questions
What does Circulating Supply mean in DeFi?
Circulating Supply means Number of tokens publicly available and actively trading. The useful question is not only the definition, but how the mechanism changes risk, return, liquidity, or governance for the user.
How is Circulating Supply used in practice?
A practical example: A project might have a total supply of 100 million tokens, but only 60 million in circulating supply due to team locks and reserves.
What should I check before relying on Circulating Supply?
Check supply inflation, unlock events, calculation differences. Also verify liquidity, oracle assumptions, admin controls, and whether the protocol has been tested during stressed markets.