Explainer · Tokenomics
How to read a token's supply numbers
October 2, 2026
Market cap gets quoted as if it were the whole story. It isn't — market cap is price multiplied by supply, and supply is the half almost nobody checks. Here is what circulating, total and max supply actually mean, what a token unlock is, and why the supply side of a project is often more knowable, and more important, than its price chart.
Market cap is only half the number
Two tokens can look identical on a price chart and be telling completely different stories once the supply behind that price is taken into account. Market capitalization is simply price multiplied by circulating supply, which means the same market cap can describe a token that is fully diluted already or one with most of its supply still to come.
Reading the supply side is not a niche exercise reserved for analysts. It is the other half of the number everyone already quotes.
Three supply numbers, not one
- Circulating supply. How many tokens actually exist and are currently able to move — what is really available in the market right now.
- Total supply. Circulating supply plus tokens that exist but are not yet circulating, typically locked under a schedule.
- Max supply. The hard ceiling, if a project has one — the most that will ever exist once everything eventually releases. A small circulating supply next to a much larger max supply is not automatically cheap; it may simply not have finished diluting.
Where the gap comes from: unlocks
The difference between circulating and total supply usually exists because of unlocks. At launch, tokens are typically allocated to categories such as the founding team, early investors and a treasury, and those allocations release on a vesting schedule rather than all at once — often over one to four years.
An unlock is simply the date a chunk of previously locked tokens becomes able to move and be sold. It is not a design flaw; vesting exists to align insiders with a project's long-term success. But each unlock is a real, scheduled increase in the supply that can reach the market, and unlike most price catalysts, the date is usually public well in advance.
Inflationary, deflationary, or mixed
- Inflationary design. New units are issued over time, often to pay for network security by rewarding the validators who keep the chain running. Total supply grows indefinitely unless something offsets it.
- Deflationary design. Units are removed from supply over time, commonly by burning a portion of transaction fees permanently. Supply shrinks rather than grows.
- Mixed design. Many projects issue new supply for security while burning some of it back. The label matters less than the net effect — whether issuance or burning wins out over a given period.
Why this moves price, mechanically
If demand for a token holds flat while circulating supply keeps growing, through ongoing issuance or a scheduled unlock, each existing token represents a smaller share of the total. That is downward pressure on price, all else equal — the same dilution math behind a company issuing new shares. None of this predicts what price will actually do, since demand moves independently of supply. But it does show which direction the supply side is pushing, and when.
Before trusting the numbers
- The gap. How much space sits between circulating supply and max supply, and how much of that is still locked up.
- The schedule. Whether a public vesting schedule exists, and when the next unlocks land.
- The net direction. Whether the design is net-inflationary or net-deflationary once issuance and burning are both counted.
The read
Price is only half of market cap; supply is the other half, and it is the half that is actually knowable and scheduled in advance. Checking it is unglamorous diligence that pays off before a large unlock lands, not after.
This is general-circulation educational content, not investment advice. It explains how token supply is structured; it is not a recommendation to buy, hold or sell any token.
For circulating, total and max supply figures, unlock schedules and burn mechanics by coin, see Blockchain IQ's coin research at /research.