I was under the impression that there was a finite number of bitcoins. Something like every prime number under 32 or was it 64 bits was a bitcoin ID. When all the bitcoins had been mined there could be no more.
So how can they double the number of them just like that? Do they add extra bits to the ID’s?
I am sure you have heard of the term Fractional Reserve Banking?
That’s our current Central Bank model that purchases most of our Treasury Bonds to keep things going. They purchase T-bonds by printing money out of thin air.
They print more dollars that in turn creates more inflation. So over time fiats purchasing power go down. For instance, the USD purchasing power has gone down 99% since the creation of the current Central Bank.
Yes there are only 21 million Bitcoins. When there is more demand for Bitcoin than supply. Bitcoin fractionalizes within the existing coins infinity. Thus, people have a fraction of a coin.
For instance, Bitcoin is $68,000. You don’t have to pay $68,000 to buy Bitcoin. You can buy $5 of a fraction of a Bitcoin. Sort of like buying a fraction of gold.
Holding the coins or even a fraction of Bitcoin becomes more valuable over time because there are less of them than gold.
It encourages saving. Even having .10 of a Bitcoin will become very valuable over time.
Bitcoin is a good hedge over inflation. Better than gold or silver.