Author: Lim Yu Qian

Translation: Blockchain in Vernacular

1. How many low-circulation cryptocurrencies are there?

Cryptocurrencies with low circulation account for 21.3% of the top 300 cryptocurrencies by market cap. This means that one out of every five cryptocurrencies with higher market cap has a large portion of its token supply that has not yet been unlocked, resulting in a market cap to fully diluted valuation (FDV) ratio of less than 0.5.

Among the cryptocurrencies with higher market caps, the 4 lowest circulating supply cryptocurrencies are Worldcoin (WLD) with a market cap to FDV ratio of 0.02, followed by Cheelee (CHEEL) at 0.06, Starknet (STRK) at 0.07, and Saga (SAGA) at 0.09. All 4 of these lowest circulating supply cryptocurrencies were released in 2023 or 2024.

The top 21% of cryptocurrencies by market cap are low-volume, while only 25% are fully diluted.

Note: "Fully diluted" means that all tokens of a cryptocurrency have been issued and are circulating in the market. In other words, a fully diluted cryptocurrency means that no tokens are locked or reserved, and all tokens available for circulation have been issued.

Most low-circulation cryptocurrencies are relatively new additions to the market: 54 of the 64 large-cap cryptocurrencies with low circulation were released in the past four years (12 in 2021, 13 in 2022, 17 in 2023, and 12 in 2024 so far). As more projects release tokens, the excess supply caused by future token unlocking is expected to continue to put pressure on the cryptocurrency market.

2. How many cryptocurrencies have fully diluted market capitalization?

Among the top 300 cryptocurrencies by market capitalization, 74 have a market capitalization to fully diluted valuation (FDV) ratio of 1. In other words, only 24.7% of the tokens of large-cap cryptocurrencies are fully issued and circulating in the market, with no tokens to be unlocked.

In comparison to low circulation cryptocurrencies, less than half or only 28 were launched in the past four years. The majority of the 74 cryptocurrencies, 46 of them, were launched between 2014 and 2020.

It is worth noting that 14 of these 74 fully diluted cryptocurrencies are memecoins. And most of the fully diluted cryptocurrencies released in 2023 and 2024 are also memecoins, such as Pepe (PEPE) and dogwifhat (WIF). This reflects the recent trend of memecoins becoming a persistent narrative or regular rotation in the cryptocurrency market.

1) 54% of large market capitalization cryptocurrencies are high circulation cryptocurrencies

Cryptocurrencies with high circulation account for 162 of the top 300 by market capitalization, which means that 54.0% of large-cap cryptocurrencies have unlocked more than half of their token supply.

In particular, 28.7% of large-cap cryptocurrencies are almost fully diluted, with a market cap to FDV ratio of 0.80 or higher. This mainly includes older cryptocurrencies such as Maker (MKR), which has a market cap to FDV ratio of 0.95, Aave (AAVE) at 0.93, and Near Protocol (NEAR) at 0.90.

Overall, the average market cap to FDV ratio for the top 300 cryptocurrencies by market cap is 0.73.

2) High Circulation Cryptocurrencies vs Low Circulation Cryptocurrencies

The percentage share of fully diluted market cap, high circulating supply, and low circulating supply cryptocurrencies among the top 300 cryptocurrencies by market cap as of 2024 is as follows:

3. Notes

This study used data from Coingecko for the top 300 cryptocurrencies by market cap as of May 8, 2024, excluding stablecoins and wrapped assets. For cryptocurrencies without a maximum supply, the fully diluted valuation was taken as the same as the market cap.

For the purposes of this study, low-flow cryptocurrencies are defined as those with a market cap to FDV ratio of 0 to 0.49, high-flow cryptocurrencies have a ratio of 0.50 to 0.99, and only cryptocurrencies with a ratio of 1 are considered fully diluted.

This research is for illustrative and informational purposes only and does not constitute financial advice. Always do your own research and exercise caution when investing money in any cryptocurrency or financial asset.