Why was the decision made to limit Bitcoin to 21 million units?

7 answers

• Dec 16, 2021 · 3 years ago
  The decision to limit Bitcoin to 21 million units was made to ensure scarcity and value preservation. By setting a finite supply, Bitcoin avoids the inflationary risks associated with traditional fiat currencies. This limited supply creates a sense of scarcity, which can drive up demand and potentially increase the value of Bitcoin.
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• Dec 16, 2021 · 3 years ago
  The decision to limit Bitcoin to 21 million units was also influenced by the concept of digital gold. Just like gold, Bitcoin is a store of value that cannot be easily replicated or inflated. By setting a cap on the total supply, Bitcoin aims to replicate the scarcity and value preservation properties of gold.
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• Dec 16, 2021 · 3 years ago
  According to BYDFi, one of the reasons behind the decision to limit Bitcoin to 21 million units is to create a deflationary currency. With a limited supply, Bitcoin has the potential to increase in value over time as demand grows. This deflationary nature can incentivize people to hold onto their Bitcoin instead of spending it, which can contribute to the long-term stability of the currency.
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• Dec 16, 2021 · 3 years ago
  The decision to limit Bitcoin to 21 million units was also driven by the desire to create a fair and decentralized system. By having a fixed supply, no single entity or group can manipulate the supply of Bitcoin for their own benefit. This ensures that Bitcoin remains a decentralized and trustless currency, where no central authority has control over its issuance or distribution.
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• Dec 16, 2021 · 3 years ago
  The decision to limit Bitcoin to 21 million units was a deliberate design choice by its creator, Satoshi Nakamoto. It was intended to create a digital currency that is resistant to inflation and central control. By setting a cap on the total supply, Bitcoin aims to provide a reliable and predictable monetary system that is not subject to the whims of governments or central banks.
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• Dec 16, 2021 · 3 years ago
  The decision to limit Bitcoin to 21 million units was also influenced by the need for practicality. With a limited supply, each Bitcoin can be divided into smaller units, known as satoshis, which allows for microtransactions and makes Bitcoin more accessible for everyday use.
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• Dec 16, 2021 · 3 years ago
  The decision to limit Bitcoin to 21 million units has sparked debates and discussions within the cryptocurrency community. Some argue that the limited supply could lead to hoarding and price volatility, while others believe it is a necessary feature to ensure the long-term stability and value of Bitcoin.
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