21 Million Hard Cap to Play Critical Role in Bitcoin (BTC) Prices

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Bitcoin’s hard limit is critical in terms of both money and investment. Bitcoin’s value has risen as demand outstripped supply.

At the time of Bitcoin’s creation, Satoshi Nakamoto placed a minimal amount of Bitcoins into existence. As a result, only 21 million bitcoins will ever be created. Nodes on the Bitcoin network enforce the hard limit, a limit embedded in the protocol’s source code.

Bitcoin’s hard limit is critical for both money and investment. A successful store of wealth such as gold and real estate, Bitcoin is difficult to expand in quantity. Bitcoin production gets more complex by half until it becomes impossible.

Scarcity will skyrocket price

Moreover, there is only a limited part of the oldest cryptocurrency worldwide: Bitcoin. In short, Bitcoin’s value has risen as demand outstripped supply. On the other hand, central government money has no strict limits, and governments can create as many dollars as they want as long as they don’t mind inflation.

Famed analyst MMCrypto recently highlighted that MicroStrategy has bought $3.5 billion of Bitcoin, followed by Terra, which has expressed ambition to buy $10 billion. As a reminder, there are only 21 million people in the world. As a result, costs will skyrocket. However, the vast majority of resources have already been extracted.

More Bitcoin is needed when most currencies are kept in wallets for an extended period of time. To keep Bitcoin’s value high, more money on crypto exchanges is chasing fewer Bitcoins. Bitcoin’s value could shift dramatically if these large Bitcoin investors, also known as “whales” as opposed to the “small fish” of the market, add to their inventory or sell some of their holdings for cash.

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