Circulating

What Is Circulating Supply?

Circulating supply refers to the number of tokens currently available for trading in the market.

This figure emphasizes the tokens that can be bought and sold “right now,” excluding those locked by the project team or not yet released. Compared to total supply, circulating supply provides a more accurate reflection of the actual distribution of tokens in the market. In contrast to max supply, it focuses on the present amount rather than the lifetime cap of a token.

Common factors that affect circulating supply include token lockups and unlocks, token burns, and new issuance (minting). These mechanisms regulate the “inventory” of tokens, directly impacting how many are available on exchanges, which in turn influences price volatility and valuation.

Why Is Circulating Supply Important?

Market capitalization is determined by both price and circulating supply, following the formula: Market Cap = Price × Circulating Supply.

With the same price, a lower circulating supply results in a smaller market cap, making it easier to push prices up or down—leading to higher volatility. Beginners often reference “total supply” without considering “how many tokens are currently tradable,” which may lead to underestimating volatility risks.

Circulating supply also affects trading depth. If circulating supply is low and order books are thin, large trades can move prices significantly and create substantial slippage. Conversely, when circulating supply is sufficient and widely distributed, prices tend to be more stable and market-making costs are lower.

Circulating supply is essential for valuation. Many newly launched tokens release only a small portion at first, resulting in a high FDV (Fully Diluted Valuation—the hypothetical value if all tokens were circulating) but a much smaller current market cap. This “low circulating rate, high FDV” situation is common in early-stage projects and requires extra caution.

How Does Circulating Supply Work?

Circulating supply changes with “token lockup and unlock” events. Vesting means a project temporarily freezes a portion of tokens, scheduled for gradual release—similar to staged deliveries. Once unlocked, these tokens enter the market and increase circulating supply. If holders sell after unlocking, this can create short-term sell pressure.

Token burns and new issuance also impact circulating supply. Burning permanently removes tokens from circulation (reducing inventory), while minting increases supply. For example, Ethereum’s EIP-1559 mechanism burns part of transaction fees (burn wallet), sometimes even causing “deflation”—a net decrease in circulating supply.

The inflation rate describes how fast supply grows; it is the ratio of new tokens issued over a period relative to existing supply. Higher inflation increases price pressure if demand remains unchanged; lower or negative inflation (deflation) makes tokens scarcer, potentially supporting or boosting prices.

The circulation ratio is the proportion of circulating supply to total supply. For many new tokens, initial circulation rates are typically between 5%–20%, meaning most tokens remain locked. Monitoring unlock schedules is critical.

How Does Circulating Supply Show Up in Crypto Markets?

Circulating supply is evident in exchange listings, DeFi liquidity pools, airdrops, and unlock events.

On exchanges—such as during new listings on Gate—only a small portion of tokens may be available at first. Low circulating supply leads to higher volatility and makes market-making more sensitive. As unlocking and additional issuance occur over time, order books deepen and price swings generally decrease.

In DeFi protocols, the tokens available in liquidity pools represent the tradable “circulating portion.” Adding more tokens to pools increases depth and price stability; withdrawing large amounts or mass selling makes pools shallower and increases slippage risk.

Airdrops instantly convert locked tokens into tradable ones. If airdropped to many users, market impact is mild; concentrated airdrops can cause significant short-term sell pressure.

How Can You Manage Circulating Supply Risk?

Make decisions based on visible data.

1. Search for your target token on Gate and open its detail page.
2. In the "Overview/Statistics" section, review “Circulating Supply,” “Total Supply,” and “Max Supply.” Also note the “circulation ratio.” If an unlock schedule or links to project documents are provided, record key dates.
3. Monitor project announcements and third-party calendars (such as unlock trackers), marking significant unlock events in the next six months to one year with reminders.
4. Plan your positions: Reduce leverage before/after major unlocks, use staggered buying/selling strategies, and set take-profit/stop-loss orders to prevent outsized losses from sudden volatility during low circulation phases.
5. Regularly review: When burn or mint announcements are released, update your supply assumptions and recalculate market cap, FDV, and circulation ratio together—instead of just focusing on price.

What Are the Recent Trends or Key Data on Circulating Supply?

This year’s data shows two main trends: Bitcoin’s new supply growth is slowing, while stablecoin supplies remain high.

As of Q4 2025, Bitcoin’s circulating supply is around 19.7 million coins—about 94% of its max supply—with post-halving issuance at record lows, reducing “natural inflation.” Compared to 2024, there’s less new Bitcoin entering circulation this year, so miners face less selling pressure.

For stablecoins, USDT’s circulating supply remains in the $100 billion range throughout 2025, while USDC stays in the tens of billions (according to CoinGecko and exchange snapshots). This suggests strong capital presence on-chain—ample “dry powder” for trading and market-making activities.

Initial circulation rates for new tokens remain low (typically 5%–20%) over the past year (based on public project disclosures), making early-stage prices highly sensitive. Unlock events are concentrated in 2025, with many projects releasing tokens weekly or monthly; single-week unlocks often range from tens of millions to several hundred million USD (check unlock tracking tools and project announcements for details).

Compared to 2024, 2025’s market places greater emphasis on “real circulating supply” and “alignment with FDV.” Investors increasingly use a combination of current market cap, circulation ratio, and unlock schedules for valuations—avoiding misleading impressions from high FDV paired with low circulating rates.

Key Terms

• Circulating Supply: The number of tokens actually available in the market for trading, excluding locked or unissued coins.
• Total Supply: The maximum number of coins that can be issued according to a project’s design.
• Market Cap: Calculated as circulating supply multiplied by current price; reflects a token’s overall market value.
• Tokenomics: The economic system that defines issuance mechanisms, allocation rules, and incentive models for a token.
• Unlock: The process of releasing previously locked tokens into the market according to schedule, increasing circulating supply.

FAQ

What’s the difference between circulating supply and total supply?

Circulating supply means the number of tokens actually available for trading right now, while total supply refers to all tokens ever issued by the project. Think of circulating supply as products currently on store shelves; total supply as everything stored in the warehouse. The closer circulating supply is to total supply, the more fully distributed the token—and the lower its future dilution risk.

Are tokens with lower circulating supply more valuable?

A low circulating supply doesn’t automatically make a token more valuable; value depends on both total supply and market demand. Price is determined by overall supply-demand dynamics—not just circulating quantity. For example, if a token has a low circulating supply but a massive total supply awaiting release, future price pressure may be downward. It’s best to consider the ratio of circulating to total supply when evaluating value.

How can I check a token’s circulating supply on Gate?

Search for your target token on Gate’s markets page. After entering its details, you’ll see data such as "Circulating Supply" and "Total Supply." Gate also displays the percentage of circulating versus total supply so you can quickly gauge release progress. This data is updated in real time to help monitor for unusual project behavior.

What does a sudden jump in circulating supply mean?

A sharp increase in circulating supply indicates that the project has released new tokens into the market—potentially causing oversupply and downward price pressure. Typical reasons include unlocking team allocations, foundation releases, or increased mining rewards. Stay alert for possible price drops during these events; follow Gate’s announcements and community updates for detailed explanations and plans.

How should beginners use circulating supply when selecting tokens?

Evaluate from three perspectives: First, check what percentage of total supply is already circulating (higher is generally safer). Second, examine whether past release schedules have been steady (avoid projects with sudden large releases). Third, review project whitepapers for remaining unlock timelines. Gate lets you compare these stats across multiple tokens to identify well-distributed projects with lower risk profiles.

References & Further Reading

• https://dictionary.cambridge.org/us/dictionary/english/circulating
• https://www.merriam-webster.com/dictionary/circulate
• https://en.wiktionary.org/wiki/circulating
• https://www.thesaurus.com/browse/circulating
• https://www.vocabulary.com/dictionary/circulate
• https://www.oed.com/dictionary/circulating_adj
• https://ahdictionary.com/word/search.html?q=circulating
• https://www.merriam-webster.com/thesaurus/circulating
• https://www.dictionary.com/browse/circulate