12-Month Circulating Supply of SOV

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January 15, 2021

One of the most important metrics used to evaluate tokens issued by projects in the crypto space is circulating supply. Circulating supply is generally defined as the total number of tokens that are available on the market, meaning they are not encumbered by a contractual or on-chain lockup mechanism that restricts their transferability.

This is opposed to the total supply of a token, which indicates total expected supply regardless of whether they are restricted or not. The circulating supply metric is important because it gives an indication of a token holder’s relative holdings in respect to the total market cap of the circulating supply. For this reason, resources such as Coinmarketcap and Messari use the circulating supply (multiplied by market price) to determine a token’s market cap.

This post will outline the expected circulating supply of the SOV token over the course of 12 months after the SOV token generation event (TGE).

It must be emphasized, however, that this is only an anticipated schedule of release, since the governance of the Sovryn protocol will be the mechanism through which coordination on the SOV supply and issuance will be decided.

At the token generation event of the SOV token, a total of 100M tokens will be created. These tokens will be issued into a number of publicly auditable smart contracts that control their release based on defined parameters.

Once a token is released from one of these smart contracts, that token is considered to be liquid and is counted towards the circulating supply.

The anticipated circulating supply is outlined below, and the market cap of SOV tokens is calculated on a illustrative price of $1 (note that this price is only intended to demonstrate the calculation of circulating market cap at a total token supply of 100M). View the chart below:

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