Circulating supply in the context of cryptocurrencies refers to the total number of coins or tokens of a particular digital asset that are currently in the hands of investors, users, or the general public and are available for trading on the open market. It excludes coins or tokens that are locked, reserved, or held by the project team or the issuer. Circulating supply is an essential metric for assessing the current market capitalization and the liquidity of a cryptocurrency.

The circulating supply is a dynamic figure that can change over time due to factors such as token minting, burning, or tokenomics mechanisms like staking or vesting. It plays a significant role in determining the market price of a cryptocurrency since it represents the portion of the total supply that is actively being bought and sold. Generally, a lower circulating supply may create a perception of scarcity and potential price appreciation, while a higher circulating supply might lead to increased market liquidity but may also put downward pressure on the token's value.

Investors and traders pay close attention to the circulating supply alongside other fundamental and technical indicators to make informed decisions about their investments. It is essential to consider the circulating supply in conjunction with the total supply and the token's utility, team, community support, and overall market sentiment to gain a comprehensive understanding of a cryptocurrency's current standing and potential future trajectory in the competitive crypto market.