Crypto Coin Circulation and Supply Why It's Important

When choosing a cryptocurrency to invest in or a new ICO, always check the supply available.

For instance take a look at these crypto's stats taken from coinmarketcap.com

Coin	Market Cap	Price	Volume 24h	Circulating Supply	Change 24h
Kin	$46,996,680	$0.000062	$78,601	756,097,560,976 KIN *	-15.71%
Gnosis	$90,513,639	$81.94	$1,919,060	1,104,590 GNO *	11.29%

What does it all mean ?

Coin is obvious it's the coin we are looking at.

Market Cap is the value of all of the circulating coins.

Price is the price of the coin at the moment you are viewing the stats.

Volume 24h is the value of all the trades from the last 24 hours.

Circulating Supply this is what we are talking about in this post, see my explanation below.

Change 24h shows the percentage change in price for the last 24 hours.

Why the Circulating Supply is Important

If an ICO or a currency is released and there are too many of them, then it will difficult for the price to move. The reason is oversupply will always lower or hold the price.

So if a chicken farmer has too many eggs to sell, he will lower the price to get rid of them.
If he has only 36 eggs left and he knows lots of people are going to come and buy some later, he will higher the price, because he knows they are in demand.

Looking at the two coins in the table above there are only just over 1 million Gnosis available, so if Gnosis is a great company, small purchases will make the coin value fly as the short supply would put these coins in great demand, I even think on bad news there would still be a line of people waiting to buy at a lower price.

With Kin they have over 756 billion coins, really this is too many coins, and it is difficult to move the price upwards, because they will never be in demand. Reminds me of the old saying when you are being offered something at a high price and you reply,

"Emmm You Can Get Them Two a Penny".