If you soon see a major boost in the ICX circulating supply, don’t be alarmed.
The ICON Foundation announced Monday that it is adopting a different methodology for determining circulating supply in the coming weeks.
This methodology includes both tokens that are circulating in the market AND tokens in the public hands.
More and more cryptocurrency exchanges and crypto projects use this methodology, which is fast becoming the industry standard.
Until now, the ICON Foundation has been using the more conservative “free float” methodology of calculating circulating supply that excludes unlocked or vested supplies held by insiders, such as unlocked tokens controlled by the ICON Foundation.
Equity markets favor the free float methodology, and the ICON Foundation still thinks it provides a better picture of circulating supply.
However, employing the free float methodology also runs counter to the practice of crypto exchanges and other crypto projects, causing unnecessary confusion. So ICON decided to abandon it in favor of the “industry standard.”
The takeaway here is:
“one of this implies that additional tokens have been or will be released to the public, and especially not sold on exchanges. The increase in supply merely reflects the adoption of a new methodology of circulating supply, which adds the previously excluded reserves held by the ICON Foundation and its partners.
Just because we will be adopting a new methodology for calculating circulating supply does not mean that the token reserves held by the ICON Foundation and its partners will now be ‘circulating in the market’ and ‘in the public hands.'”
Now, to be sure, there has been a recent increase in circulating supply unrelated to the methodology change. That increase — by roughly ICX 10 million — resulted from the ICON Foudation’s partnership with DeFI platform ICONFi to mint 50 million ERC20-based ICX tokens.
