Community Submission - Author: Anonymous
The maximum supply of a cryptocurrency refers to the maximum number of coins or tokens that will be ever created. This means that once the maximum supply is reached, there won’t be any new coins mined, minted or produced in any other way.
Normally, the maximum supply is capped by the limits defined by the underlying protocol of each digital asset. Therefore, the maximum supply and issuance of new coins are usually defined at thegenesis block according to the project’s source code (which also defines many other features and functionalities).
Setting a steady issuance rate together with a predefined maximum supply can be valuable for controlling the inflation rate of a cryptocurrency, which may potentially lead to a long-term appreciation of the asset. Generally speaking, when the maximum supply is reached, there will be fewer coins available on the market. This is expected to create market scarcity, which may eventually lead to deflation conditions (or 0%inflation rates).
However, some cryptocurrencies do not have a predefined maximum supply, meaning they can be mined or minted continuously.Ethereum is a notable example of a cryptocurrency system that has no predetermined maximum supply. Ether’ssupply is constantly increasing as new blocks are generated.
Max supply vs. total supply
As mentioned, the calculation of max supply includes all coins that were already produced (or mined) plus the coins that are yet to be issued (in the future). On the other hand, thetotal supply includes only the coins that were already produced minus the units that were destroyed, for instance, incoin burn events.
FAQs
After a token reaches maximum supply, the argument goes, the coin's supply becomes static - miners can no longer create new coins. The demand should continue to grow. A maximum cap, they hope, guarantees value gains. Not many such coins exist.
What is the maximum supply of BNB? ›
Binance Coin BNB Live Price Summary
BNB is -0.63% in the last 24 hours, with a circulating supply of 153.86M BNB coins and a maximum supply of 200.00M BNB coins.
Does circulating supply affect crypto prices? ›
The total supply of a cryptocurrency is a key factor – along with circulating supply – that affects its market value. Crypto supply is an important concept for anyone looking to use or invest in a coin or token to understand.
What happens when a token runs out of supply? ›
Generally speaking, when the maximum supply is reached, there will be fewer coins available on the market. This is expected to create market scarcity, which may eventually lead to deflation conditions (or 0% inflation rates).
Will Bitcoin reach 1 million? ›
Dorsey, who led the social media platform from 2015 to 2021, developed a strong interest in crypto during that time and is now fully focused on the sector. Jack Dorsey believes the price of bitcoin could reach over $1 million by the end of 2030.
Which crypto can reach 100 dollars? ›
The year 2023 proved to be quite positive for certain altcoins. Three cryptocurrencies under discussion either surpassed the $100 barrier or came close to it. Let's explore whether Solana (SOL), Injective (INJ), and Avalanche (AVAX) can reach the three-digit mark.
Can BNB reach $2,000? ›
Our BNB price prediction estimates that the token could be valued at $2,000 in five years.
How high can BNB go 2030? ›
BNB (BNB) Price Prediction 2030
| Year | Price |
|---|
| 2025 | $ 560.73 |
| 2026 | $ 588.76 |
| 2027 | $ 618.20 |
| 2030 | $ 715.65 |
1 more rowAccording to CoinCarp, the top BNB token holder is a wallet linked to Binance, which holds about 12 million coins, which amounts to 49.62% of the total tokens in circulation.
What does circulating supply tell you? ›
The circulating supply refers to the number of coins or tokens of a particular cryptocurrency currently available to the public and actively in circulation. These are the coins that can be bought, sold, or used for transactions.
What Happens When Circulating Supply Reaches Max Supply? When the max supply and the circulating supply are equal, all coins have been released into circulation. Depending on the state of the market, the price of cryptocurrencies may move up or down, but nothing significant will happen.
Which coin has the lowest supply? ›
Bitcoin, Ethereum, and Litecoin are some known examples of low supply cryptocurrencies. There are also smaller and less familiar projects, with limited supplies.
How high can Bitcoin realistically go? ›
Ark's research suggests the cryptocurrency could soar 2,115% to almost $1.5 million by 2030 -- but Wood herself came out with an even more bullish estimate recently, saying Bitcoin could rocket 5,453% to $3.8 million.
How to increase circulating supply? ›
Some cryptocurrencies, such as Bitcoin, have a limited supply, and their circulation can only be increased by mining. On the other hand, developers of some more centralized tokens can increase their supply of tokens in circulation through immediate minting, similar to central banks.
What if crypto reaches max supply? ›
No additional bitcoins will be generated when the Bitcoin supply reaches its upper limit. Bitcoin miners will likely earn income only from transaction fees.
What happens if Bitcoin reaches max supply? ›
However, once the maximum supply of 21 million bitcoins is reached, these block rewards will cease. Miners will then solely rely on transaction fees as their compensation for validating transactions and securing the network.
Does max supply matter in crypto? ›
In summary, the maximum supply of a cryptocurrency has implications for its price and market value. It can influence supply and demand dynamics, scarcity, and liquidity in the market.
What happens when a coin reaches its market cap? ›
Market cap is the total value of a cryptocurrency calculated by multiplying its current price by the total circulating supply. It affects crypto prices by influencing investor sentiment and perceived value, as higher market cap can indicate higher demand and potential stability.
What happens when circulating supply is reached? ›
If the circulating supply is equal to the maximum supply, this means that the entire quantity of cryptocurrencies has been released. The price of the relevant cryptocurrency may gain or lose value depending on market conditions.
