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The limited supply of Bitcoin also means that it is a deflationary currency. Inflation occurs when the supply of a currency exceeds the demand, leading to a decrease in the currency's value. Deflation, on the other hand, occurs when the demand for a currency exceeds the supply, leading to an increase in value. With a fixed supply of Bitcoin, its value is likely to increase over time as the demand for the currency grows.

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Bitcoin's fixed supply and deflationary nature have led some analysts to predict that the currency will become more valuable over time. As the demand for Bitcoin grows, the limited supply is likely to increase its value. This is one factor that has led some investors to see Bitcoin as a potential hedge against inflation and a store of value.

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<h2>The History of Bitcoin's Supply</h2>

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Bitcoin, the world's first and largest cryptocurrency, has reached a major milestone in 2021. The total supply of Bitcoin has officially reached its threshold of 21 million coins. This significant event highlights the limited supply of Bitcoin, which has been a defining feature of the cryptocurrency since its creation. In this article, we will explore the significance of this milestone and what it means for the future of Bitcoin.

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The creation of new coins, or the process known as mining, is how the total supply of Bitcoin increases over time. When Bitcoin was first created in 2009, the mining reward was set at 50 BTC per block. This reward was halved every 210,000 blocks, which is approximately every four years. This process of halving creates a predictable supply curve, which will eventually reach the fixed limit of 21 million coins.

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Bitcoin, the world's first and largest cryptocurrency, has reached a major milestone in 2021. The total supply of Bitcoin has officially reached its threshold of 21 million coins. This significant event highlights the limited supply of Bitcoin, which has been a defining feature of the cryptocurrency since its creation. In this article, we will explore the significance of this milestone and what it means for the future of Bitcoin.

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The fixed supply of Bitcoin at 21 million coins is one of the currency's key selling points. Unlike traditional currencies, which can be printed at will by governments, Bitcoin has a finite supply. This means that it cannot be inflated like fiat currencies and therefore has a unique store of value.

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The limited supply of Bitcoin also means that it is a deflationary currency. Inflation occurs when the supply of a currency exceeds the demand, leading to a decrease in the currency's value. Deflation, on the other hand, occurs when the demand for a currency exceeds the supply, leading to an increase in value. With a fixed supply of Bitcoin, its value is likely to increase over time as the demand for the currency grows.