Why is there a fixed maximum limit on the number of bitcoins that can ever be created?
Cryptocurrency
Asked by Question Bot11/Jul/20141 answer
1 Answer
F
Faisal Khan
Answered 11/Jul/2014
Well they had to assign a number, and 21 Million was chosen. The reason behind has been hashed to death, limited supply, so no inflationary pressures can be invoked.
Do remember that each Bitcoin in itself can be broken down to a 100th Millionth piece, which is the smallest transfer you can do, i.e. the smallest unit that can be traded is: 0.00000001 BTC and has been aptly named a "Satoshi" most likely paying homage to its anonymous founder.
If the value of Bitcoins becomes too large, then dealing in these Satoshis would be the norm, which would then result in the Bitcoin ecosystem being:
21 Million Bitcoins x 100 Million Satoshis = 21,00,000,000,000,000 Satoshis, or
2,100 Trillion Satoshis.
Do remember that each Bitcoin in itself can be broken down to a 100th Millionth piece, which is the smallest transfer you can do, i.e. the smallest unit that can be traded is: 0.00000001 BTC and has been aptly named a "Satoshi" most likely paying homage to its anonymous founder.
If the value of Bitcoins becomes too large, then dealing in these Satoshis would be the norm, which would then result in the Bitcoin ecosystem being:
21 Million Bitcoins x 100 Million Satoshis = 21,00,000,000,000,000 Satoshis, or
2,100 Trillion Satoshis.