Max supply refers to the maximum number of coins or tokens that will ever exist for a given cryptocurrency. It represents the absolute limit of issuance — once this number is reached, no additional coins can be created or mined.
Max Supply
What is max supply ?
Max supply refers to the maximum number of coins or tokens that will ever exist for a given cryptocurrency. It represents the absolute limit of issuance — once this number is reached, no additional coins can be created or mined.
For example, Bitcoin has a fixed max supply of 21 million coins, meaning its issuance will permanently stop once that threshold is met. In contrast, some cryptocurrencies, such as Ethereum, have no capped supply, allowing continuous creation through network rewards.
Understanding max supply is essential for traders because it helps evaluate a cryptocurrency’s scarcity and long-term price potential. Assets with a fixed or deflationary supply tend to be viewed as more scarce, which can influence market demand, inflation rate, and overall valuation.
Max supply is typically defined in a project’s whitepaper or protocol code and may change only through governance votes or protocol upgrades. It’s also an important factor in calculating market capitalization and tokenomics, alongside circulating supply and total supply:
Market Cap = Current Price × Circulating Supply
By analyzing max supply, traders can better assess whether a cryptocurrency’s current price reflects its future dilution potential and supply-demand dynamics.