How Do Locked Tokens Influence the Circulating Supply Metric?
Locked tokens, those subject to vesting or other restrictions, are explicitly excluded from the circulating supply. Circulating supply is the number of tokens currently available in the market for trading.
By excluding locked tokens, the metric provides a more accurate picture of the immediate market capitalization and liquidity. As locked tokens vest and become available, the circulating supply increases, which can put downward pressure on the token price if demand remains constant.
Glossar
Locked Tokens
Custody ⎊ Locked tokens represent digital assets held within a secure, controlled environment, typically a smart contract or custodial wallet, restricting immediate transferability.
Fully Diluted Valuation
Calculation ⎊ Fully Diluted Valuation in cryptocurrency, options, and derivatives represents the theoretical price of an asset assuming all potential convertible securities are exercised.
Market Capitalization
Valuation ⎊ This metric represents the total notional value of all circulating units of a cryptocurrency, calculated by multiplying the current spot price by the total supply outstanding, serving as the primary measure of an asset's overall economic scale within the market.
Circulating Supply
Token ⎊ The circulating supply within cryptocurrency contexts represents the number of tokens currently available and actively traded on exchanges or held by investors, excluding those locked in smart contracts, staking agreements, or otherwise inaccessible.
Impact of Token Burns
Mechanism ⎊ The impact of token burns refers to the economic consequences of permanently removing a certain quantity of cryptocurrency tokens from circulation, typically by sending them to an unspendable address.