Definition ∞ Token supply percentage represents the proportion of a digital asset’s total or circulating supply that is held in a specific address, wallet, or by a particular entity. This metric provides insight into the distribution of an asset and can indicate concentration of ownership. Analyzing token supply percentage helps assess decentralization, potential market manipulation risks, and the influence of large holders. It is a key indicator for understanding market dynamics.
Context ∞ News often references token supply percentage when discussing whale activity, initial coin offering distributions, or the decentralization of a blockchain network. Debates frequently center on the implications of highly concentrated token supplies for governance and market stability. A low token supply percentage held by a few entities suggests a more centralized asset. Future developments aim to promote wider distribution and more equitable token ownership models within new protocols.
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