How cryptocurrency supply affects its market value
Crypto supply affects market value through demand and tradable coins. Check the supply figures on a coin's page and note the date before you judge it.
Vahe HakobyanEditor-in-chief
Updated Oct 5, 20263 min readFact-checked
On this page
- Market cap uses circulating supply, not max supply.
- Burns remove coins; mints and block rewards add them.
- Bitcoin's block reward halved in April 2024.
To judge a coin, compare its supply figures with demand and check what can actually trade. Public data is enough.
What moves crypto market value?
Crypto market value depends on supply, demand, and how many coins can actually trade. Supply counts coins that exist. Demand counts buyers who want them. When few coins trade, each trade can move the value more.
- Supply counts existing coins.
- Demand counts buyers who want them.
- Locked or staked coins usually cannot change hands.
How to read a coin's supply
A coin can report several supply numbers. Read them together, and remember that market cap is not money invested in the coin.
- 1Find circulating supplyThis counts coins that can trade now.
- 2Compare total and max supplyTotal supply includes locked coins. Max supply is the cap in the rules, if one exists.
- 3Check market cap and FDVMarket cap uses circulating supply. Fully diluted valuation uses max supply, or total supply if there is no cap.
- 4Look for burns and mintsA burn removes coins. Minting and block rewards add new coins.
- 5Review halvings and emissionsA halving cuts the new coin reward on a schedule. Bitcoin's block reward halved in April 2024.
After you check unlocks: records and safety
Token unlocks release locked coins. Vesting spreads releases over time, while a cliff releases a large batch on one date. Staking lockups also keep coins off the market. Ethereum enabled staking withdrawals in April 2023.
Frequently asked questions
No. A cap limits supply, but market value also depends on demand and tradable coins.
Sites update on different schedules and count locked or staked coins differently. Check the date.
A token unlock cliff is one date when a large batch of locked tokens becomes tradable at once.
Yes. A project can mint new tokens or release them from a vesting lockup.
