How a Crypto Coin Supply Works

in Tron Fan Club2 months ago

Assalamu Alaikum


How are you? By Allah's grace, I'm doing very well. What I want to share with you today is Coin Supply. First we will talk about the max supply, suppose the max supply of X coin is 2 thousand coins (let's call the coin X coin for everyone's understanding).

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The thing about max supply is, suppose a company has created X coins and has a supply of X coins at 2000, now the company wants to increase their supply of coins but they can't even if they want to. This is because if a coin company has set a max supply of coins, then the company cannot increase the amount of their coins later if they want to, but the max supply of coins must be given. That means the company cannot increase the supply of X coins above 2000 but if they want to reduce the amount of coins they can do so. So now let's discuss the total supply, let's say 2000 supply of X coins, company wants they will not release 2000 coins in the market. They will keep few coins with them, so what company will do now is company will release 1500 coins to market and keep 500 coins for themselves out of company 2 thousand supply. So here is the total supply, 1500 coins that left the market and the remaining 500 coins are called circulating supply. This is how Total Supply works. So now we will talk about circulating supply.

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Circulating supply is similar to total supply but there are some differences between total supply and circulating supply. All the traditable coins in the crypto market, that is, all the coins that can be traded or all the tradable coins in the market are collectively called circulating supply. Suppose max supply is 2 thousand, total supply is 1500 and circulating supply is 500. Basically, as many coins as are available in the market to trade, they are considered together as supply. Now we will discuss about unlimited supply, unlimited supply is very dangerous. Unlimited supply is much like X coin supply is 2000 and if coin is not given max supply then company can increase their number of coins at any time. If they want to increase from 2000 coins to 3 thousand, from 3 thousand to 10 thousand coins they can increase.

Today's discussion concludes here. I hope you've found it interesting. Please share your thoughts on today's topic. Prayers for everyone. May everyone be well. Amen.

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Upvoted! Thank you for supporting witness @jswit.

Today's conversation clarifies the principle of distributing supply as well as the risks of endless supply in cryptocurrencies. Limitless supply positions a substantial threat, permitting firms to arbitrarily enhance coin numbers threatening financier self-confidence as well as possibly decreasing the money. Your understandings are valued; allow's maintain the discussion going. So be it.

I am just impressed with how you have simply explained the economic of cryptocurrency,very interesting article.

Although I have quite a bit of experience with crypto currency supply, your presentation today is quite commendable,

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