There's only 8% of bitcoin left to be mined
Bitcoin, the world's first decentralised digital currency, has become a global phenomenon. One of the key characteristics that sets Bitcoin apart from traditional currencies is its limited supply. Bitcoin's maximum supply is capped at 21 million coins, with only 8% left to be mined. Bitcoin's scarcity is a significant factor in its value, and here's why:
Store of Value
Bitcoin's scarcity makes it an excellent store of value. Unlike fiat currencies that lose value over time due to inflation, Bitcoin's limited supply ensures that its value remains stable or increases over time. Bitcoin's scarcity also makes it resistant to hyperinflation, making it an excellent hedge against economic uncertainty.
Bitcoin mining is the process of validating transactions on the Bitcoin network and receiving newly created Bitcoin as a reward. However, as Bitcoin's supply is limited, the rewards for mining decrease over time. This means that as the remaining Bitcoin supply becomes scarcer, mining becomes more challenging, and the rewards become smaller. This scarcity ensures that the creation of new Bitcoin is controlled and slows down over time.
Bitcoin's scarcity also makes it more secure. As Bitcoin's supply becomes scarcer, it becomes more valuable, and this incentivises miners to protect the network. The higher the value of Bitcoin, the more difficult it becomes for bad actors to launch an attack on the network. This makes the Bitcoin network more secure and trustworthy.
Bitcoin's limited supply is one of the key features that make it so valuable. Unlike fiat currencies that can be printed at will, Bitcoin's supply is fixed and limited. This means that as demand for Bitcoin increases, its price also increases. The limited supply of Bitcoin creates scarcity, making it a valuable asset.
Bitcoin's scarcity can be compared to that of gold, which is also a scarce asset. However, there are some key differences between the two that make Bitcoin superior to gold in terms of scarcity. Firstly, while gold's supply is finite, it is difficult to accurately determine how much gold is left to be mined.
Estimates vary widely, and it is possible that new deposits of gold may be discovered in the future, increasing its supply. In contrast, Bitcoin's maximum supply is fixed, and there can only ever be 21 million coins in circulation.
Secondly, gold mining requires significant resources, including equipment, labor, and energy. In contrast, Bitcoin mining can be done with just a computer and an internet connection, making it more accessible and less resource-intensive.
Finally, gold is a physical asset that can be lost, stolen, or destroyed. Bitcoin, on the other hand, is a digital asset that is stored on a decentralised network, making it more secure and resistant to physical damage or loss. In summary, while gold is also a scarce asset, Bitcoin's fixed maximum supply, accessibility, and security make it superior to gold in terms of scarcity
In conclusion, Bitcoin's scarcity is a critical factor in its value and importance as an asset. The limited supply of Bitcoin creates scarcity, making it a valuable asset and an excellent store of value. Bitcoin's scarcity also ensures that mining rewards decrease over time, which controls the creation of new Bitcoin. Furthermore, Bitcoin's scarcity makes the network more secure, ensuring that it remains resistant to attacks. As Bitcoin's supply becomes scarcer, its value is likely to increase, making it a valuable asset for investors seeking a stable investment option