bitcoinpoorguy on Nostr: Hey Bitcoiners, here's my 8th video on Youtube: ...
Hey Bitcoiners, here's my 8th video on Youtube:
https://www.youtube.com/watch?v=47-ijS-Uqoo
Summary:
The idea that Bitcoin’s divisibility equates to unlimited supply is a misconception rooted in mixing two distinct concepts. Divisibility refers to the ability to break a Bitcoin into smaller units, such as 1 BTC being divisible into 100,000,000 satoshis. However, Bitcoin’s total supply is capped at 21 million BTC by its protocol, ensuring its scarcity remains intact regardless of how small it can be divided.
Imagine Bitcoin as a pizza, with the total supply represented by 21 million whole pizzas. Dividing a pizza into 8, 16, or even 100M slices doesn’t increase the amount of pizza—it only makes sharing easier. Similarly, Bitcoin’s divisibility allows for precise transactions without affecting the total amount in existence or the proportion of Bitcoin someone owns.
This is fundamentally different from fiat currencies, where governments can print unlimited money, increasing supply and causing inflation. For example, if a country doubles its currency supply, the purchasing power of each unit diminishes. In Bitcoin’s case, no central authority can alter the supply, and divisibility does not dilute its value.
By separating divisibility from supply, we see that Bitcoin’s design preserves its scarcity and purchasing power, distinguishing it from fiat currency and ensuring its role as sound money.
https://www.youtube.com/watch?v=47-ijS-Uqoo
Summary:
The idea that Bitcoin’s divisibility equates to unlimited supply is a misconception rooted in mixing two distinct concepts. Divisibility refers to the ability to break a Bitcoin into smaller units, such as 1 BTC being divisible into 100,000,000 satoshis. However, Bitcoin’s total supply is capped at 21 million BTC by its protocol, ensuring its scarcity remains intact regardless of how small it can be divided.
Imagine Bitcoin as a pizza, with the total supply represented by 21 million whole pizzas. Dividing a pizza into 8, 16, or even 100M slices doesn’t increase the amount of pizza—it only makes sharing easier. Similarly, Bitcoin’s divisibility allows for precise transactions without affecting the total amount in existence or the proportion of Bitcoin someone owns.
This is fundamentally different from fiat currencies, where governments can print unlimited money, increasing supply and causing inflation. For example, if a country doubles its currency supply, the purchasing power of each unit diminishes. In Bitcoin’s case, no central authority can alter the supply, and divisibility does not dilute its value.
By separating divisibility from supply, we see that Bitcoin’s design preserves its scarcity and purchasing power, distinguishing it from fiat currency and ensuring its role as sound money.