Unprotected cryptocurrency hero: Understand the difference between food in circulation and overall supply
When it comes to understanding the world of cryptocurrencies, two terms are often launched during launch, without much reflection: “food in circulation” and “total supply”. Although the two indicate the total quantity of coins in circulation, they reflect different concepts, which are very important for understanding the complexity of the cryptocurrency economy.
What is a power supply?
The traffic offer means the number of parts that are currently used or exchanged. This reflects the number of parts that can be purchased, exchanged or used for individuals and bodies. This includes not only physical parts in circulation, but also digital chips stored in exchange, wallets and other online platforms.
For example, if you buy Bitcoin, you mainly buy 1 cryptocurrency unit, which is then added to a “power supply”. If you exchange a bitcoin to another part, the power supply in global circulation remains the same.
What is a full supply?
On the other hand, the global offer means the total number of parts of parts that will never be created. This is a fixed amount that will never change despite fluctuations or market demand. This term is often used to describe the concept of “complete active ingredients” in the cryptocurrency economy.
The overall offer of a particular part is generally linked to the main assets, such as gold or fiduciary currency. For example, the total bitcoin offer is limited by $ 21 million. Units, ensuring that there will always be enough coins in circulation, taking into account market demand.
Main differences
So, what are the main differences in circulation and overall food? Here are some major differences:
* The supply in circulation compared to the complete supply : circulating supplies indicate the current number of parts for use or trade, while the total offer means a fixed quantity which will never be created.
* Effect of the market
: market fluctuations and demand changes belong to supplies in circulation, which can affect its price. On the contrary, the total offer is a fixed value that remains unchanged, despite the market conditions.
* Liquidity : The supplies in circulation can affect liquidity levels in exchange, as parts which are easily sold can increase the supply in circulation. However, the total offer does not directly affect liquidity.
Effect and programs
Understanding the difference between supply in circulation and global supply has a major impact on investors, traders and market players:
* Investment strategies : Investors can use this knowledge to inform their investment decisions, such as the purchase or sale of parts depending on changing prices.
* Market analysis : Understanding the circulation offer and the global offer helps analysts to analyze market trends and identify potential risks and capacities.
* Regulatory compliance : The exchange of cryptocurrency and portfolios must meet the regulatory requirements linked to food in circulation and general food.
In conclusion, in order to navigate the complex world of cryptocurrency economy, it is necessary to understand the difference between traffic and general supply. By understanding these two concepts, individuals can make more reasonable decisions on investment, trade and cryptocurrency in daily life.
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