Revisiting Circulating Supply Definition

Governance
1

The Internet Computer’s (ICP) circulating supply is currently defined as all ICP tokens publicly available and circulating, including community-staked tokens, but explicitly excludes liquid (non-staked) ICP tokens owned by the DFINITY Foundation, per the NNS-approved definition from April 18, 2023 (Proposal 117360). The current definition was discussed by the community in forum post 19297 and the change was recommended to best align with industry practices at that time. Please revisit that forum post for more history on the circulating supply definition.

Since that conversation in April 2023, two trends have been present:

  1. No industry standard has been established and industry practices have diverted in many ways, including the practice of including liquid foundation tokens in circulating supply (see: Ethereum, Polkadot, etc)

  2. The current definition is confusing to market and ecosystem participants because they (a) believe the Foundation’s liquid tokens would logically be included in circulation and (b) are confused with the seemingly contradictory facts that (1) ~49M tokens are not in the circulating supply, and (2) all token unlocks are completed in June when the last seed investor neurons can dissolve (for any seed investor who chose to dissolve).

Given that, despite DFINITY and the NNS’s best attempts in 2023 to be consistent with industry expectations, the current definition for ICP’s circulating supply causes confusion and misalignment with industry expectations. We propose to adopt the definition that circulating supply is equal to the total supply of ICP because it aligns better with industry practices and aligns with the fact that all pre-Genesis locked tokens will have had the ability to unlock by June 2025.

We invite any community feedback. Should the community generally agree with this definition, DFINITY will submit an NNS proposal for vote. Should that proposal be accepted, DFINITY will work with industry partners to reflect this change.

11 Likes
2

Agree (increase circulating supply when ICP ranking drops

2 Likes
3

does the Foundation use a different blockchain?

2 Likes
4

image
image1664×373 44.8 KB

Under what circumstances did they make this decision?

2 Likes
5

This is very reasonable and makes sense compared to what other L1 account as supply.

For bitcoin we don’t remove satoshi’s btc from the supply, we shouldn’t remove any ICP either.

4 Likes
6

No standard because it’s all dependent on the image you wanna portray. Could portray upside potential. Could portray sell pressure. Could portray decentralization/token distribution.

Not all that interesting to me because it doesn’t matter how you define it when you still need to factor things appropriately depending on what you’re trying to quantify and you can’t make a general definition.

Whatabout undispursed maturity? It’s essentially liquid supply with a one week delay, which is still liquid in my opinion.

1 Like
7

People fudge numbers by comparing with BTC and include Satoshi or don’t include it to articulate whatever narrative they are trying to spin.

1 Like
8

Your proposal seems reasonable to me @Kyle_Langham. I’d be fine with the change.

2 Likes
9

I think Kyle made the best of the resources available to him and made this post in the forums. We should appreciate the hard work by Kyle and the Foundation members. Truly setting an outstanding example in this industry. I believe Kyle and other “experts” of the DFINITY Foundation made the decision to exclude the DFINITY Foundation’s token supply.

We should also exclude DFINITY Foundation’s token supply from the Network Nervous System, Network Economics and Governance Voting too.. Food for thought. Since there’s no industry standard established anyways

3 Likes
10

+1 This is very disturbing.

13

Thanks @Kyle_Langham, I wasn’t aware that the current definition excludes some ICP based on who’s holding it. I agree that this is confusing/misleading, but I appreciate that it’s a definition that was arrived at with transparency and community consultation.

Yes, I agree that circulating supply should equal total supply. Let’s get it changed (and then keep that definition).

Thanks for writing this up and putting it out.

1 Like
14

This is an interesting point. But how far do you push it? Should staked ICP be considered liquid if the neuron is 7 days away from being dissolved. What about 14 days?

15

Now neurons are part of circulating supply, maturity is just something used to avoid taxes

2 Likes
16

Is there another mystery stockpile we got laying around to add to the books in case we fall off the first page on the listings by market cap again?

17

Of course, we have 100 million ICP equivalent maturity that is not included in the calculation
If it weren’t for the tax issue they would definitely be part of the circulating supply. ICP would also rank higher

4 Likes
18

I agree supply is equal to the total supply of ICP. and we should consider neuronal maturation, its thr part of ICP too .

19

my 2 cents - Yes, a foundation’s liquid tokens should be included in the circulating supply. Additionally, any tokens set to unlock within the next month should also be counted. Since circulating supply calculations vary across the industry and are often framed to suit different interests, the best approach is to maintain full transparency. This means reporting the current circulating supply at any given time, along with a projection of tokens expected to unlock in the next month.

3 Likes
20

But this may cause dfinity and whales to sell more ICP to pay taxes

Okay, it’s hard to choose.

2 Likes
21

It’s tricky but in all honesty, the maturity is not in circulating supply until it is spawned, no? It’s a pity CMC just don’t elaborate on their supply so we could show how much ICP is locked up and for how long etc…love your work YSYMS

22

Transparent and trustless is the foundation for building Web3. This aligns with that design. Good to see.