What Is Total Supply?

Total Supply is the total amount of a cryptocurrency that will ever exist. It is important to understand this concept when investing in cryptocurrencies, as it can have an effect on the price and market capitalization of a particular coin or token. Total supply refers to all coins or tokens that are currently available for circulation plus any additional ones that may be created through mining or other means. This number does not include coins held by developers, founders, exchanges, etc., which could potentially affect the overall supply if released into circulation at some point in time.

The total supply of a cryptocurrency can also be affected by inflationary mechanisms such as halving events and staking rewards. Halvings occur when miners receive fewer rewards for their work due to increased difficulty levels; this reduces the rate at which new coins enter circulation and thus affects the total supply over time. Staking rewards refer to incentives given out by certain networks (such as Ethereum) for users who hold onto their coins instead of trading them; these rewards increase the circulating supply but do not necessarily add more units into existence since they come from existing funds already held within wallets.

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