Circulating Supply refers to the total number of coins or tokens that are actively available in the market and can be bought or sold. This includes coins or tokens held by the public and excludes those that are locked, reserved, or not yet released.
For instance, if a cryptocurrency has a total supply of 20 million coins, but 2 million are locked in a founder's wallet and 1 million are yet to be mined, the circulating supply would be 17 million coins.
The circulating supply of a cryptocurrency can change over time due to various factors. These include new coins being mined or created, coins being burned or destroyed, and coins being locked or unlocked.
In the case of Bitcoin Cash (BCH), there are currently over 17 million BCH that have been mined. However, due to some being lost over time, there are fewer in circulation. Coins can be lost when the sole controller of a private key dies, the private key is lost or destroyed, or money is sent to an incorrect address. It is impossible to know exactly how many coins of a currency have been lost. In a decentralized system, we can only know the total coins that have been mined/created, the eventual max supply, and how much is being moved over periods of time.
The circulating supply is an important metric for investors as it can influence the price of a cryptocurrency. A lower circulating supply can lead to a higher price per coin or token, assuming demand remains constant. Conversely, a higher circulating supply can lead to a lower price per coin or token, assuming demand remains constant.
If the circulating supply of a cryptocurrency is 1 million coins and the market cap is $1 billion, the price per coin would be $1,000. If the circulating supply increases to 2 million coins and the market cap remains the same, the price per coin would decrease to $500.
* All terms and definitions may update as the Cryptionary improves.