Circulating Supply Definition

Governance
23

I’m no wise man, but this is exactly what I predict would happen.

Anything that changes market cap suddenly would be seen as market manipulation, regardless of what arguments DFINITY Foundation would have. It would really damage the image that we IC community project (as if we had a positive image to begin with!).

After all, what is wrong with sticking with current definition? After 2 more years, circulating would be close to market cap anyway.

What is there to gain with changing the definition? “Catching up with industrial norm”? @Kyle_Langham How many do you think would care had you not raised this topic?

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As @Kyle_Langham explained, what we have right now isn’t functionally useful. And basing our valuations on what other people will think is practically the definition of market manipulation.

What we should strive to be is accurate.

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25

First time I heard of this accusation. Do you have any reference where people are calling our current definition “market manipulation”?

I doubt anyone outside of IC community bothered to look at our definition. Each chain practically define it their own way. But the point is, changing it after 2 years in the market will only make us look like clowns.

I would agree that the proposed new definition is more “succinct”. But “accurate”? Give me a break!

26

Hi All,

With my non developer background the input I would have,

Why don’t we keep Bitcoin as the prime example.

Anything that’s not been mined, is not part of the market cap, If it doesn’t exist it shouldn’t be part of the calculation.

At the same time, lost btc remains part of the btc circulating supply calculation.

My own conclusion:
Staked icp exist, hence they should be part of the supply.

Icp that exists only as “voting power for maturity” from an existing neuron, doesnt actually exist yet, it shouldn’t be part of the circulating supply

I understand btc and icp are 2 totally different fruits, but if we wanna stick with the core philosophy we should always look back at the founding tech and draw our conclusion from there, sometimes. (Not all the time)

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27

I would agree that we shouldn’t change the CS definition because investors are irrational.

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28

Hi @levi. I definitely agree that the CS phrase is ambiguous. Unfortunately, since it’s the standard metric within the industry our choice is to adopt it and try to make the most sense of it, or not be listed in most aggregate.

I like your idea of creating our own meaningful metrics, useful for our community. You list a few good ones. The following are on the dashboard (dashboard.internetcomputer.org) and the other ones I can talk to the dashboard team about adding.

Dfinity foundation 8-year-staked tokens: xx
Total tokens staked for 8-years: xx
Total tokens staked for at least a year: xx
Total tokens not staked: xx

If there must be a number, my view is to put the total supply.

Yes, I agree with this statement, particularly given how the industry has changed in the last two years (DeFi contracts, governance, etc). It would require a large change within the industry, but I would support a move towards this goal for the industry.

@Forreal - we discussed whether staked tokens should be considered non-circulating for the reason you pointed out. Ultimately we could not find a single case where that standard was upheld… every single proof of stake coin considers the staked coins to be circulating. We later got clarification from CMC that “locked” in this context is similar to the term “escrow”.

The quote above I got from CMC definition. Staked ICP would not meet the criteria to be added as circulating supply.

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29

Coin Market Cap mentioned that its somewhat common for coins to change their circulating supply metric, however this is the first time a coin has done so transparently. Usually it occurs behind the scenes with a change in the coin’s financial APIs and third parties (like CoinMarketCap) are left with the responsibility of discovering it and making a decision on whether the new definition is within reason of industry expectations. From this, I gather that there is low risk of being accused of market manipulation, particularly since we have chosen a path of full transparency.

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30

I guarantee if you guys change the definition it’s going to hurt all investors. I don’t think you understand how irrational people are especially when all you need to cause panic is say icp increased their circulating supply by 35% and just have a before and after pic. That alone will cause the price to drop.
I say don’t this change and leave it be. There’s no problems with the definition.
If you guys do decide to change the definition please let everyone know exactly when so I can short this coin temporarily.

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31

@CatPirate as one of the moderators of this forum, you should know that your comment is ad hominem (calling Kyle’s work “contemptible”). This is a friendly warning to please moderate your criticism in a more rational way.

To be frank, considering the various accusations you have laid out in the past, this warning should not be a surprise:

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32

@Kyle_Langham do you know any concrete examples?

@Jabberwocky and @benji do have a reasonable point that folks can be irrational and they don’t see this thread so any changes surprises many people (all change is surprising of course).

33

If a company discovers inaccuracies in their valuations and does not correct them due to fear of appearances, that is considered market manipulation.

This is a case where the lack of universal standards probably means there is no legal liability, but that is beside the point. A healthy organization strives to be accurate in its accounting because that is what is fair to their investors and best for their long term interests.

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34

Hello @kpeacock and DFINITY team, I think you should consider make a ver simple Circulation Supply definition as the amount of tokens available and liquid in the market, because you have created an outstanding architecture, you can perfectly differenciate the amount of ICP in the addresses from the ICP staked in the neurons, so a simple definition would be:

" All the ICP tokens in addresses ready to transfer or use is by the owner is a circulation supply"

" All the ICP tokens staked in the NNS as neurons are not circulation supply"

Total Supply = Circulation supply + Staked Supply

I do not think maturity should be considered as Staked supply until the spawn neuron is made.

I do not think DFINITY tokens should be excluded from the Circulation Supply, why is that? If DFINITY Foundation has the tokens ready to use, those tokens are also circulation supply. If they want to put the tokens to non circulation supply then, they can lock the tokens as a neuron.

And to finalize, if DFINITY foundation and Members of the dfinity team have so many tokens supply that it’s affecting the amount of circulation supply or total supply of tokens, they can always as they do, make more bounty programs, burn a part of the tokens they hold (I mean, if there is a huge amount of them, burn some would not impact their wealth…).

Hope it helps, anyway, whatever the final definition, I love what you are building and congrats to dfinity’s team members.

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35

I don’t have any concrete examples, but I can reach back out to CMC to see if they will provide some.

I agree with @Jabberwocky and @benji that there is the potential for inaccurate conclusions to occur if we change the CS definition, particularly by persons who have not read this forum thread. Prior to making the original forum post, we discussed that internally as a potential risk and concluded the benefit of making a more clear definition and aligning with peers outweighed that potential risk. I welcome the community’s feedback on that assessment.

For anyone concerned with the risk discussed above, I’d recommend Messari’s circulating supply charts as a great reference to investigate more. A few charts that show a large jump in CS are:
https://messari.io/asset/the-graph/chart/sply-circ
https://messari.io/asset/polygon/chart/sply-circ
https://messari.io/asset/hedera-hashgraph/chart/sply-circ

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36

There is a potential risk of “selling” but that’s not a problem, that’s a benefit!
I’m not sure @Jabberwocky and @benji what the problem would be if ICP went to $3.25 as a result of brute’s selling after the circulating supply was adjusted. It would be temporary. It would be the transfer of ICP from weak hands to strong hands - normal market occurrence.
Buying opportunity of a lifetime and 8-year gang holders don’t care either, we have an 8-year long term outlook in my opinion.

37

I’d like to echo concerns pointed out here.

I do think any change in the definition of circulating supply will land us with accusations of market manipulation. We want to be known for our technology, and this may end up causing unwanted negative attention.

If I understand correctly, the change in the definition will cause our ranking to go from 41 to like 35. I’m not sure it’s worth the brain damage for such a small movement.

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38

You can guarantee a price dump from this change but cannot guarantee it will be restored to the same price once everything cools off

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39

I agree with @Jabberwocky, maybe this is not the best time, in a bear market, to make this kind of adjustments, we could wait until a bull run occurs, the ICP holder community has already suffered enough holding ICP tokens which have been continuosly dumping in price.

In my opinion maybe focus on ckETH, BadLands, and other functionalities prior this theoretical definitions without any use case would be a better path for now.

We can delay this for a while and adjust when the time is more favorable.

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40

Does not circulating mean coins that can be bought and sold but Staked coins are not coins at all but are promised when they are un-staked and then put into circulation and be counted.

My Staked coins have already been counted and Spawned coins in Neuron will not be available to the end of a staked period and will have no bearing on the market till they are released which then will be added to the total supply and counted.

Staking is a voting power ONLY!.

Tron - Max Supply – Not Known - Total Supply 90,934,599,345

Polkadot - Max Supply – Not Known - Total Supply 1,300,256,554

Solana Max Supply – Not Known Total Supply 539,312,705

Max supply states that:
The maximum amount of coins that will ever exist in the lifetime of the cryptocurrency. It is analogous to the fully diluted shares in the stock market.

If this data has not been submitted by the project or verified by the CMC team, max supply shows

But a new thing I have noticed:
The CoinMarketCap team has verified the project’s circulating supply to be as follows:

ICP
Max Supply – Not Known
Total Supply 497,342,812

Verified Data
The CoinMarketCap team has verified the project’s circulating supply to be as follows:
Circulating Supply 298,492,813 ICP

As I understand it the max supply when not stated can change quickly, not by stakers but the Coin owners themselves or maybe one day the Stakers.

The system as I see it is correctly stated and will be updated when the circumstances change.

The Max Supply of ICP can be changed in the future by Billions or even Trillions. It makes sense to me. If the IC is the new Internet then the max coins will have to grow to accommodate the cycles needed and if the coin is set to Max of 24m, would then be worth the price of BTC.

Will the ICP coin ever be worth anything but a cycle?

I would like to see a max supply as you don’t need to but a whole coin.

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41

It appears much of the feedback in this forum thread is aligning towards concern that changing the CS definition may have an immediate negative impact on the price of the token. I’m interested in learning more about this view in order to understand it better. @Jabberwocky , @mrwangharuto , @dfisher @benji - could you explain more please? Particularly useful would be examples, articles or analyses that demonstrate and/or support your concern and would be useful for understanding your position.

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As an example, the FUD around launch caused a big distraction redirecting focus away from ICP technology. We wanted people to focus on the tech, and instead they questioned the integrity of the Dfinity team and we were left talking about things to the broader crypto world we didn’t want to focus on. That was not our fault, but it is an example of a major distraction.

I fear the non-ICP broader crypto public (Justin Bons of the world) are not looking to give us the benefit of the doubt, and will accuse us of trying to manipulate the CS in order to climb the rankings. It should be pointed out that we are not currently (yet) trusted and viewed favorably by the broader crypto ecosystem, and this could worsen things.

I could be wrong, but it is certainly a risk we should consider.

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