As the Bitcoin halving event in May is getting closer, Coinbase recently set out to advance the narrative of “Bitcoin as Digital Gold.” In a tweet storm posted on February 7 to facilitate the release of related blog posts, it covered key reasons why a half price cut and subsequent reduction in supply rates would further strengthen this connection.
Scarcity creates value
Since breaking the gold standard in 1971, the value 바이비트 of the US dollar has fallen, and the value of gold has increased by more than 4000%. Due to its relative scarcity and difficulty to obtain, gold is more valuable than similar metals such as copper.
Bitcoin is designed to be as scarce as gold and artificially difficult to obtain through the proof-of-work process of mining. However, compared with gold, it also has advantages in terms of transmission through communication channels.
Halving increases scarcity
The supply of Bitcoin is limited by design, and new tokens are minted as rewards each time a large number of transactions are mined. The initial reward level of 50 BTC per block has gone through two halving events, reducing it to the current 12.5 BTC per block.
After halving in May 2020, the mining reward for each new block mined approximately every ten minutes will be reduced to 6.25 BTC. This will bring the supply and circulation of bitcoin to a rate of about 1.7% per year