Hard Cap

The maximum supply limit imposed on a crypto asset is known as its hard cap. Bitcoin has a hard cap of 21 million coins. This means that there cannot be more than 21 million coins present at any given point in the market. Blockchain technology makes this change immutable, given its nature; information like this is hardcoded into the software of the blockchain systems. Different crypto assets have different hard caps while a few have an unlimited supply.

Hard caps of any asset help them remain deflationary since their number is limited and therefore, the supply is limited despite the demand. The hard cap is also known as maximum supply and this is the most widely used term in the crypto industry. During the ICO campaigns, the upper limit is set in every round for which the round closes. These are also known as hard caps.

The amount of funds is decided by the crypto project developers in order to reach the estimated fund required to launch the project. The total amount required by them can be multiplied by the hard cap of the token with the price of each token. This value is called its market cap or soft cap.

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