2. Circulating Supply Methodology
Methodology: Design Ethos
Circulating Supply can be estimated via below two different perspectives:
A Bottom-Up Approach: Accumulating amount of tokens sent from group of addresses, adding amount of tokens for every outgoing transaction from the group. While seemingly intuitive, it becomes difficult to generalize over numerous, different actual use-cases. One of such difficulties include where tokens are distributed where sources are recurring, ingoing transactions*.
A Top-Down Approach: Subtracting amount of tokens that can be verified to be existing from total number of tokens existing on-chain. While having rather a simpler approach, problem occurs with accuracy; more tokens may be considered to be in a circulating status since by default Tokens existing on-chain are considered to be in a circulating status.
While Xangle aims to provide a statistically more accurate methodology to satisfy both aspects in circulating status estimation, we adopt a Top-Down approach: A simpler, more conservative approach where responsibility of proving non-circulating status lies on the token project's side, which gives more safeguard features for retail investors.
Methodology Under the Hood
In crypto, circulating supply refers to the amount of cryptocurrency in circulation. To accurately calculate circulating supply, several key terminologies and their data types need to be defined before actual estimation procedure occurs.
To accurately determine circulating supply, it is imperative to understand how core logic works, not to mention additional cases where tokens are managed among different chains, needs verification between an actual unlock schedule, and even take into account numerous anomalies that might occur. Therefore, Xangle diligently tracks and administers the following aspects :
General FAQ
A list of frequently asked questions for Circulating Supply estimation can be found below. In addition, Non-circulating Supply specific FAQs can be also found at Non-circulating Supply
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