Low Supply Cryptocurrency 2024 | Statesman

Bitcoin is getting ever closer to reaching its maximum and limited supply, pushing its price higher and making it harder to mine. As a general rule, the fewer coins are available to the general public, the higher the value of the cryptocurrency becomes. Mining is no longer possible when a cryptocurrency reaches its maximum supply. The market price therefore reflects supply and demand. Bitcoin has a set limit of 21 million coins, the last of which will be mined around the year 2140 according to a 2017 prediction – with the assumption that Bitcoin’s mining rate halves every four years.

Why are there so many differences in cryptocurrency offerings?

Cryptocurrency developers can determine whether a coin should have a fixed limit, depending on the blockchain it uses or monetary strategies. Ethereum has no maximum supply, which means miners can create and mine this cryptocurrency indefinitely. This is called an inflationary cryptocurrency, one that continually inflates supply. The idea is that the number of tokens in circulation continues to exceed demand, decreasing the overall value. Some coins limit the release of their (indefinite) supply or even destroy (burn) tokens. Such deflationary events occurred with LUNA in 2022.

The attractiveness of low-supply cryptocurrency for investors

Cryptocurrency investors tend to be looking for cryptocurrencies with limited supply, ideally at low levels. After a token reaches maximum supply, it is argued that the coin’s supply becomes static: miners can no longer create new coins. Demand is expected to continue to grow. A cap, they hope, guarantees valuable gains. There are not many coins of this type. AAVE DeFi platform is an example of a cryptocurrency with a maximum supply of less than 100 million.

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