What is total supply?

Think of a company that has printed tickets for a concert. Some have been sold to the public, others are still in the drawer and some have been permanently canceled. For total supply, we count the ones that exist, whether they are available or set aside, but we subtract the permanently canceled ones.

If, for example, a project has created 100 million tokens and has permanently destroyed 10 million through a token burn, the total supply is 90 million. If 30 million of those are locked for the team, they still count. Locking is not the same as destroying.

Why it matters

When you look at a crypto’s data, you’ll come across three different numbers. Circulating supply refers to the units considered available on the market. Total supply also includes the existing units that aren’t circulating. Max supply, where there is one, is the upper limit on the number of units that can ever exist under the project’s rules.

The distinction helps us understand how many tokens already exist outside circulation and may become available later. A token unlock can increase circulating supply without changing total supply, since the tokens had already been created. Issuing new units, on the other hand, increases total supply.

What to watch out for

Total supply isn’t necessarily fixed. It can increase as new units are created or decrease through burns. Also, coins sitting in wallets with lost private keys usually still count, because loss of access isn’t easy to prove and doesn’t constitute a burn.

We look at this number together with the issuance rules, the unlock schedule and the token allocation. A small total supply on its own proves neither scarcity on the market nor value. We need to know who controls the existing units and whether more can be created.