Can circulating supply decrease?

Can the circulating supply of a cryptocurrency actually decrease? It's a question that many in the industry have asked, as the concept of a deflationary asset can be somewhat counterintuitive in the world of finance. Typically, as a currency gains popularity and more people adopt it, its supply increases to accommodate the growing demand. However, some cryptocurrencies, such as Bitcoin, have a fixed supply cap that is designed to gradually decrease over time through a process known as mining. But what about the circulating supply? Can it actually shrink? Let's take a closer look at the factors that could potentially impact the circulating supply of a cryptocurrency.