Trump: "Bitcoin will be made in USA"
(twitter.com)
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I asked chat GPT, what makes bitcoin finite?
Here is the answer...
Bitcoin is finite due to its underlying protocol, which was designed to limit the total supply to 21 million coins. This scarcity is a fundamental aspect of Bitcoin's design and is achieved through several key mechanisms:
Protocol Rules: Bitcoin operates on a decentralized network governed by a set of rules encoded in its software, known as the Bitcoin protocol. These rules include the total supply cap of 21 million bitcoins. Any change to this cap would require a consensus among the majority of participants in the network, making it highly unlikely.
Block Reward and Halving: When Bitcoin was introduced, miners received a reward of 50 bitcoins for each block they successfully mined. This reward is halved approximately every four years, an event known as "halving." The halving process continues until the block reward reaches zero, which ensures that the issuance of new bitcoins decreases over time. This geometric progression ensures that the total number of bitcoins will asymptotically approach, but never exceed, 21 million.
Cryptographic Consensus: Bitcoin's network relies on a consensus mechanism known as Proof of Work (PoW). Miners compete to solve complex cryptographic puzzles to add new blocks to the blockchain. This consensus mechanism ensures that the creation of new bitcoins follows the protocol rules, including the supply cap.
Mathematical Precision: The finite supply is also a result of Bitcoin's use of fixed mathematical algorithms. Bitcoin's issuance schedule is predetermined and follows a predictable and transparent path, ensuring that the supply is strictly controlled.
Decentralization and Network Consensus: Bitcoin's decentralized nature means that no single entity controls its issuance. Changes to its core protocol, including the supply cap, require broad consensus across the network's nodes. This decentralization helps enforce the scarcity of bitcoins.
The finite supply of bitcoins is a key feature that differentiates it from traditional fiat currencies, which can be issued in unlimited quantities by central banks. This scarcity is often cited as a reason for Bitcoin's potential as a store of value, akin to precious metals like gold.