Scarcity
At Bitcoin’s inception, an unchangeable code was initiated which guaranteed that there will only ever be 21 million Bitcoins in the universe. Fiat money (i.e. national currencies) can be printed and created at the government’s / central bank’s discretion. In other words, the supply has no limit. Technically, neither does the supply of gold. While gold has maintained relative scarcity for a long time, it is far from unfeasible that we could discover new ways of finding and mining gold. Innovations that could rapidly release large quantities of new gold supplies into the global system include and are not limited to sea-floor and asteroid mining. We may also find ways to create synthetic gold with increasing degrees of sameness to real gold at a decreasing cost, similar to recently observed innovations in lab-grown diamonds. All that said, Bitcoin is simply superior to fiat money and gold in terms of scarcity. This exceptional and all-important characteristic may be Bitcoin’s single greatest strength as a form of money.
Last modified 2yr ago