Supply Cap
The maximum number of tokens that can ever exist for a given cryptocurrency.
In-Depth Explanation
Bitcoin's 21 million cap is the most famous example. Supply caps create scarcity—no more can ever be created. Not all tokens have caps; Ethereum has no maximum supply (though it's currently deflationary post-merge). Capped supply with growing demand creates appreciation pressure; uncapped supply requires careful emission management.
Related Terms
Fully Diluted Valuation
FDVThe theoretical market cap if all tokens (including locked, unvested, and unissued) were in circulation.
Inflation (Token)
The rate at which new tokens are created and enter circulation, diluting existing holders.
Circulating Supply
The number of tokens currently available and trading in the market, excluding locked, vested, or reserved tokens.
More in Tokenomics
View all →Emissions
New tokens distributed by a protocol as incentives, typically to liquidity providers or users.
Liquidity Mining
Earning token rewards by providing liquidity to a DeFi protocol.
Token Buyback
When a protocol uses revenue to purchase its own token from the open market, reducing circulating supply.
Dividend
Direct distribution of protocol revenue to tokenholders, typically in ETH, stablecoins, or the protocol's native token.