Bitcoin’s Economic Model
Go Private Market Guide
March 26, 2025
GoGPT Summarizes Articles
Fixed Supply and Halving Events
Unlike traditional currencies, which can be printed indefinitely, Bitcoin has a hard cap of 21 million coins. New Bitcoin is introduced through mining, but approximately every four years, the reward for miners is halved in an event known as the Bitcoin Halving. The most recent halving in 2024 reduced the reward to 3.125 BTC per block.
Inflation vs. Deflation
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Traditional Currencies: Governments can print more money, leading to inflation.
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Bitcoin: A fixed supply leads to deflationary tendencies, as demand may increase while new supply decreases.
Bitcoin as an Asset: Store of Value or Currency?
Bitcoin’s economic model has sparked debate over whether it should be considered a store of value (like gold) or a medium of exchange (like cash). While some investors hold Bitcoin as a long-term asset (HODLing), others use it for transactions, though its volatility presents challenges.