beginnereconomics

Supply cap

Definition

Bitcoin’s supply cap is a hard limit of 21 million coins built into the protocol. No person, company, or government can change it. New coins are created through mining at a decreasing rate, and the last Bitcoin will be mined around the year 2140.

Example

Unlike dollars, which governments can print without limit, Bitcoin's supply cap is fixed at 21 million coins.

Related Terms

Bitcoin

A decentralized digital currency that operates without a central bank or single administrator.

Scarcity

A limited supply that cannot be easily increased, making something more valuable as demand grows.

Halving

An event that cuts the Bitcoin block reward in half approximately every four years.

Mining

The process of using computational power to verify transactions and add new blocks to the blockchain.

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