Supply and Market Dynamics

  • Total Supply: The maximum number of tokens created, influencing inflation and scarcity.

  • Circulating Supply: Tokens actively available for trading and use, affecting liquidity and market stability.

  • Inflationary vs. Deflationary Models: Inflationary models release new tokens regularly, potentially diluting value, whereas deflationary models reduce token supply over time, potentially driving scarcity and demand.

  • Variable vs. Fixed Supply Models: Variable supply models allow adjustments to the total supply based on economic conditions or governance decisions, providing flexibility. Fixed supply models have a predetermined total number of tokens, creating certainty and often encouraging scarcity-based value appreciation.

  • Market Capitalisation: Reflects token valuation based on circulating supply and market price.

  • Fully Diluted Market Cap: Reflects total valuation considering all tokens that will ever exist, providing insight into long-term expectations and potential market pressures.

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