Title: The Dark Horse of Cryptocurrencies: Understand the difference between total nutrition and circulating diet
Introduction
The cryptocurrency world has evolved rapidly since the beginning in 2009, with many new actors who enter the market every year. However, among these newly drops, a concept stands out as a crucial aspect of understanding the dynamics of cryptocurrency – the difference between
total supply
and
circulating supplies . In this article, we will deepen the main differences between these two important metrics, providing information that will help you emerge the complex world of cryptocurrencies.
What are total nutrition and circulating nutrition?
To understand the distinction between total supply and circulating offer, we first define each term:
* Total Supply (T) : Refers to the total amount of a cryptocurrency source, which represents all coins or tokens that were created or created. It includes not only new coins, but also any existing coins that are still in circulation.
* CIRCULATIVE DEFENSE (CS) : This is the part of the total offer that has already been distributed among users, owners and exchanges. It represents the number of currencies actively used by individuals or institutions.
Main differentiated
Now that we define both terms, we explore the main differences between total nutrition and circulating nutrition:
- TimeFlasme : Times differ significantly between these two metrics. Current offer is the current amount of coins in the system, while the total supply refers to all existing currencies.
2 This makes it a volatile indicator, while the total offer remains constant, reflecting the actual number of coins available.
- Inflation : Current offer may lead to inflation, in which the supply of existing currencies increases, causing the increase in its value over time. However, this is not always the case in cryptocurrency markets, known for the high price volatility.
- Predictability : Total offer is generally more predictable than circulating supply, as it reflects an accurate reflection of all available currencies. Current offer may be highly unpredictable, making it a demanding metric to be foreseen.
Real world examples
We examined two examples that demonstrate the difference between total supply and circulating supply:
* Bitcoin (BTC) : The total offer of Bitcoin is 21 million, reflecting the release of initial currencies in 2009. Currently, more than 18 million bitcoins are in circulation, with the remaining currencies extracted or transferred from the system .
* ETHERUM (ETH) : Although the total offer of Ethereum remains constant at about 118 billion, the circulating offer was flooded significantly due to variations in demand for users and market conditions.
Conclusion
Understanding the difference between total supply and circulating offer is critical to anyone interested in cryptocurrency markets. By recognizing these important differences, you will be better equipped to navigate the complex world of cryptocurrencies, make informed investment decisions and avoid possible traps. Remember that total nutrition remains a reliable indicator of the real number of coins available, while circulating nutrition may display volatile behavior.
Suggestions for cryptocurrency investors
To maximize your return to cryptocurrency markets, consider the following:
* Keep the currencies existing : Investing in consolidated cryptocurrencies such as bitcoin or Ethereum usually produces less volatility and greater stability than the latest currencies with uncertain market prospects.
