Bitcoin is more than a currency or security, it's scarcity.

[PrivacyG]

Even though that might seem like a good thing, it has consequences associated with it. By burning bitcoin it might never be used as a currency and will just be used as an investment tool.

Considering it is so highly divisible, Bitcoin can be used as a Currency even if only a rather small amount of it remains available.  I do not think it would be a problem.  The 'burn' happens naturally anyway, even if people do not send Bitcoin to inaccessible Addresses.

Also.  Consider at some point in the future some body may out of complete luck generate the Private Key for that particular Address and the whole 'burnt' Bitcoin goes into circulation once again.  You just never know.

Besides.  Do these Addresses contain such significant amounts anyway?  Last time I have seen their Balance, it did not seem like they had a big impact on the scarcity of Bitcoin.

[Gladitorcomeback]

People used to lose their Bitcoin when Bitcoin didn't have much value and they barely cared about their Bitcoin holdings. If you or I were from that time, we had either mined Bitcoin with our home CPU, claimed from free Bitcoin faucets, or bought then at an extremely low rate, we would also tend to care less about them, we would either sell them for whatever rate it had at that time or a later time when it got some value.

Things have changed now, Bitcoin is extremely valuable and every person understands this now. So the chances of someone losing their Bitcoin these days are extremely tiny because anyone who spends thousands of dollars to acquire a small part of it would take care of it very well and will make sure they have backed up their wallet and necessary information so that they don't lose access to it.

[Plaguedeath]

I will revise your subject.

Bitcoin is more than a currency or security it'sor scarcity, but are decentralized, secure and private!

If Bitcoin didn't have one of three I mentioned above, I doubt Bitcoin can grow as high as now since there's a weakness in Bitcoin and it would make people to not completely trust in Bitcoin.

[Iranus]

This is exactly the reason why burning bitcoin or any cryptocurrency is a thing.

Why do altcoin projects create a large supply and then announce a partial burn, and why don't they create a coin with a small supply in the first place? Don't be so naive as to fall into those silly traps, burning supply is just one of many tricks that makes investors believe that when scarcity occurs, an increase in value is inevitable.

People attempt to remove some bitcoin out of the circulation so that its supply decreases therefore increasing more of its value. They do this by sending bitcoin into an address only to never be accessed ever again.

Are you brave enough to send your bitcoins to those dead wallets to increase the value of bitcoins? The value of bitcoin depends on the use cases it brings us, supply is just one of many factors that contribute to bitcoin's success.

Even though that might seem like a good thing, it has consequences associated with it. By burning bitcoin it might never be used as a currency and will just be used as an investment tool.

Don't rush to think about that scenario, look at what's going on, do you view and use bitcoin as a currency or are you looking at it as an investment to generate high profits? I think limited supply is not a good reason to deny that we don't use bitcoin as a currency.

[stompix]

Bitcoin was built differently and to be scarce, the total supply of Bitcoin is fixed but the circulating supply of Bitcoin will always be shrinking and this would not only be happening every four years because of Bitcoin halving but it is happening frequently because of the lost of Bitcoin that might never be tradable again.

Before preaching about money and bitcoin you should really study Bitcoin more.
The circulating supply of Bitcoin is always increasing and will do so for a long time from now, the amount will not shrink (unless major accidents) for decades to go.

Second, scarcity doesn't mean something has value, there are thousands of tokens/coins /altcoins /forks that are also "scarce" but this doesn't mean they have value, it would be enough to look how the 21 million forks of Bitcoin have the same supply and issuance and BCH is $500 while BSV $60.
One needs utility before scarcity to have some value!

[kryptqnick]

Scarcity is a good principle because it saves from overprinting and thus hyperinflation, but it's impossible to get it perfect for each case all in advance. That's why fiat is usually monitored and policies are adjusted based on what's going on. Sometimes they are adjusted poorly, but usually it works okay. The thing with money is that most economists seem to agree that it shouldn't grow in value, and it shouldn't even preserve the same value over time. In fact, it should lose value at around 2-3% annually to motivate big purchases and economic growth. Bitcoin is rising in value significantly over time, and while it's great news for investors, it might also be a challenge to BTC adoption as money because people want to hodl, not spend.

[Faisal2202]

Money needs to be scarce to preserve its value and Bitcoin is scarce therefore the future of money has to be Bitcoin and this is one of the best chances we have to accumulate it before it becomes more scarce.

You have started a good topic, this factor/feature of BTC definitely needs more hype. As in the long run scarcity of BTC is the main factor that plays an important role in driving its price in a positive trend. Otherwise, if it would be normal fiat then there would be a need of centralized authority, that could implement Interest rates, or pegging it with limited supply of commodity like gold. That would be against the context of BTC.

Therefore I am glad that Satoshi put scarcity factor in it. Besides BTC I was confused why you said money need to be scarce, as I do understand that to save the value over time just like BTC is doing, but till now I did not saw a single country that have this feature of scarcity directly implemented in there currency although they do adopt other option to limit the circulation or printing of money, like increasing the interest rates, which stops people to borrow more money thus lesser printing and circulation, there might be other ways too, like open market etc.

[Onyeeze]

People have different understanding in Bitcoin that is why you see many people explain bitcoin differently you will see also people who is saying that bitcoin is a scam tea today so what I want us to understand is that the 100 years coming there's some people who will be saying bad about Bitcoin there will be also a set of people who will discourage people not to embrace Bitcoin so from my own understanding someone saying good about Bitcoin it is person that have already make a proper research of Bitcoin and no the values and advantages and the disadvantages of Bitcoin so the journey of Bitcoin is a personalist and it is best on your own conception

[GbitG]

I will revise your subject.

Bitcoin is more than a currency or security it'sor scarcity, but are decentralized, secure and private!

If Bitcoin didn't have one of three I mentioned above, I doubt Bitcoin can grow as high as now since there's a weakness in Bitcoin and it would make people to not completely trust in Bitcoin.

Definitely bro I agree with you that if Bitcoin doesn't have any of these things So people will not trust on Bitcoin.
 
Decentralization, Sscarcity are the two important factors, which I think make Bitcoin promising to the world. Scarcity's greatest quality is that it influences the store of value, which also depends on decentralization. Despite these two qualities, they exist within Bitcoin. So I agree with you that if these two factors were not present in Bitcoin, people would not trust it as much as they do because of the lack of a value store and the lack of a decentralized ecosystem, that is, without scarcity and decentralization functions, Bitcoin would be considered a lay coin.

[Cryptoprincess101]

Money needs to be scarce to preserve its value and Bitcoin is scarce therefore the future of money has to be Bitcoin and this is one of the best chances we have to accumulate it before it becomes more scarce.

Basically we all know that Bitcoin has a limited supply of 21 million Bitcoins and 19 millions have been mined already so as the remaining 2 million Bitcoins is coming closer to being mined that is how Bitcoin will become more scarce and the value will increase and that is what will make Bitcoin get to the moon when the demand will outsmart the supply so what you said is very true because any one who is aware of how scarcity works will know that now is the time to accumulate and keep in your custody before it gets to a point where it will become unaffordable when the price will skyrocket to a crazy ATH.

[SquirrelJulietGarden]

The supply of Bitcoin isn't actually increasing slightly like the graph is illustrating, however it is constant. Bitcoin has a constant supply cap of 21 million coins.

You must use correct term.

Supply is a confusing term. You can use Total supply or Circulating supply. The total supply, that is implied in your post, is capped at 21 million bitcoins. The circulating supply will increase and after four halvings so far, the curve for circulating supply will increase slightly in future years.

How is the 21 Million Bitcoin Cap Defined and Enforced?

Here are two graphs for illustration

You can use these available charts.

[redsun114]

Yes and the banning of some countries are a proof to that. There are countries where BTC is not banned but there are still people who ignore BTC. BTC is already scarce due to its fixed and limited amount of supply. There is also halving which makes BTC even scarcer.

I don't think that the circulating supply is going to shrink but it can actually grow in size the more the new BTC have been mined and the more the adoption we have. BTC is not a secret anymore. There are now plenty of information lying around and people already know its true worth, so gone are the days that people will less care of their BTC, up to the point that they will lose it. IMO I think it's okay if money is not scarce but as long as its value remains the same.

[fuguebtc]

I will revise your subject.

Bitcoin is more than a currency or security it'sor scarcity, but are decentralized, secure and private!

If Bitcoin didn't have one of three I mentioned above, I doubt Bitcoin can grow as high as now since there's a weakness in Bitcoin and it would make people to not completely trust in Bitcoin.

Definitely bro I agree with you that if Bitcoin doesn't have any of these things So people will not trust on Bitcoin.
 
Decentralization, Sscarcity are the two important factors, which I think make Bitcoin promising to the world. Scarcity's greatest quality is that it influences the store of value, which also depends on decentralization. Despite these two qualities, they exist within Bitcoin. So I agree with you that if these two factors were not present in Bitcoin, people would not trust it as much as they do because of the lack of a value store and the lack of a decentralized ecosystem, that is, without scarcity and decentralization functions, Bitcoin would be considered a lay coin.

That's right , we need a combination of decentralization and scarcity to create value for bitcoin , without one of the two bitcoins would not be as attractive as they are today. But I value bitcoin's decentralization more than any of its advantages because no other asset is as decentralized as bitcoin, and that's what we've been looking for for a long time. Scarcity is important but is useless if not combined with decentralization. Because creating an asset with a scarce supply is not so difficult, but creating a decentralized asset like bitcoin is not easy and so far only bitcoin is unique.

[jrrsparkles]

I was doing some research to add to my understanding on Bitcoin and discovered that many people still do not know how powerful Bitcoin can become in the future. Bitcoin was built differently and to be scarce, the total supply of Bitcoin is fixed but the circulating supply of Bitcoin will always be shrinking and this would not only be happening every four years because of Bitcoin halving but it is happening frequently because of the lost of Bitcoin that might never be tradable again. If anybody knows how valuable scarce things are then they can be able to see how important Bitcoin is going to be when this knowledge gets understood by the world.

Money needs to be scarce to preserve its value and Bitcoin is scarce therefore the future of money has to be Bitcoin and this is one of the best chances we have to accumulate it before it becomes more scarce.

I am little confused, are we talking about Bitcoin as money or as investment?

Money is not supposed to be scarce but it should be finite unlike fiat which can be printed as much they want and people who hold it no control over how much money will be printed so they can't really use it as store of value.

Money should be convenient, accessible although Bitcoin can be both money and asset but you're not really talking about it's decentralisation just the profits.

[$weetne$$]

Before preaching about money and bitcoin you should really study Bitcoin more.Second, scarcity doesn't mean something has value, there are thousands of tokens/coins /altcoins /forks that are also "scarce" but this doesn't mean they have value, it would be enough to look how the 21 million forks of Bitcoin have the same supply and issuance and BCH is $500 while BSV $60.
One needs utility before scarcity to have some value!

Thank you for this information, you are very correct, I thought I learnt something important and wanted to share it with everyone but I did not get the information correctly. I always have an open mind to learn and get corrected because it will help me become a better person. I have looked at it again, scarcity has no effect when there is no utility for the product. An item that people do not want would not have value in spite of it being scarce and the examples of Bitcoin forks makes the point more clear. I did some research on the coins you mentioned and they are trading below Bitcoin in spite of their founders claiming that the altcoins are more Bitcoin than the actual Bitcoin. I see people are just greedy and want to take all the credit for Bitcoin success meanwhile the real founder born rounders are running away from all the attention and in the hiding.

[thillai]

Bitcoin isn't just a currency or investment; its true essence lies in its scarcity. With only 21 million coins ever to be mined, Bitcoin becomes a digital rarity, akin to digital gold. This scarcity ensures its value and makes it a sought-after asset in today's economy.