What is a Supply?
Quick Definition
Supply refers to the total amount of tokens that have been issued and are in circulation.
Full Definition
A token's supply can be fixed (a hard cap, like Bitcoin's 21 million), inflationary (continuously increasing through new issuance), deflationary (decreasing through burns), or dynamic (adjusting based on built-in mechanisms). Supply is a fundamental concept in token economics because it directly affects the value of each individual token. For example, a sudden increase in supply without a corresponding increase in demand will typically reduce the value of each token.
Supply in stablecoins
In stablecoins, supply is typically tied directly to the amount of assets held in reserve. When new tokens are minted, reserves should grow correspondingly. When tokens are burned, reserves should be released. This dynamic linkage between supply and reserves is what allows a stablecoin to maintain its intended value over time.
How Steady's supply works
STDY's total supply is dynamic because it depends on our reserves. As our reserves grow through the yield generated by our underlying assets, the supply of STDY grows as well. This growth is managed through the rebase mechanism, which automatically increases each holder's balance to reflect the growth of the underlying reserves. When a rebase event occurs, the total supply increases proportionally across all holders, ensuring that no individual is advantaged or disadvantaged relative to others. All holders benefit proportionally from the performance of the underlying assets.
Additional changes in supply occur when qualified institutional investors acquire or redeem STDY through our primary market, with the smart contract minting or burning tokens accordingly. Total supply data is published in real time on the Transparency Portal.
Related Terms
Backing
ReadBacking refers to the assets or mechanisms that support a stablecoin's value and help it maintain its intended reference value.
Market Capitalization
ReadMarket capitalization, or market cap, is the total value of all tokens in circulation, calculated by multiplying the current price by the circulating supply.
Minting & Burning
ReadMinting is the process of creating new tokens; burning is the process of permanently removing tokens from circulation.
Rebase
ReadA rebase is an automatic adjustment to the total supply of a token, where every holder's balance changes proportionally to reflect a new total supply.
Other Glossary Items
Learn about common and essential terms related to Steady and other stablecoin protocols.
Algorithmic Stablecoin
ReadAn algorithmic stablecoin attempts to maintain its value through automated rules that adjust token supply based on market demand, rather than holding equivalent reserve assets.
AML
ReadAML (Anti-Money Laundering) refers to the laws, regulations, and procedures designed to prevent the use of financial systems for laundering the proceeds of crime.
APY
ReadAPY, or Annual Percentage Yield, is the standardized rate of return an asset generates over a year, including the effect of compounding.
Arbitrum
ReadArbitrum is a Layer 2 blockchain network built on top of Ethereum, designed to offer faster and cheaper transactions while inheriting Ethereum's security and infrastructure.
Asset Backing
ReadAsset backing refers to the real-world or on-chain assets held by the issuer to support the value of every token in circulation.
Asset Locking
ReadAsset locking refers to restricting access to funds for a defined period or condition, during which they cannot be transferred or used.
Asset Segregation
ReadAsset segregation is the practice of keeping client or backing assets separate from the issuer's operational funds, protecting them from the issuer's other obligations.
Audit
ReadAn audit is an independent examination of a protocol's code, reserves, or operations by qualified third parties to verify accuracy and compliance with stated claims.
Blockchain Network
ReadA blockchain network is the system of connected participants and infrastructure that validates, records, and maintains data on a specific blockchain.
Blockchain
ReadA blockchain is a distributed digital ledger that records transactions across a network of computers in a secure, transparent, and tamper-resistant way.
Bridge
ReadA bridge is a mechanism that enables the transfer of assets or data between different blockchain networks.
Clarity Act
ReadThe Clarity Act is a proposed US legislative framework intended to clarify the regulatory treatment of digital assets, defining when they should be treated as securities versus commodities.
Collateralization / Over-collateralization
ReadCollateralization refers to the ratio between the value of assets held in reserve and the value of tokens issued. Over-collateralization means holding more in reserves than the value of tokens issued.
Composability
ReadComposability refers to the ability of different protocols, contracts, and tokens on a blockchain to interact and combine with each other seamlessly.
Counterparty Exposure
ReadCounterparty exposure refers to the risk that another party, such as a bank, custodian, broker, or service provider fails to fulfill its obligations, potentially affecting the assets or funds it holds.
LearnMoreAboutSteady
Transparency Portal
reserves, statements, audits, smart contract, and more.
FAQs
Discover the basics about Steady in our frequently asked questions.
Contact Us
questions, feel free to get in touch. We'll be happy to help.
