How Bitcoin differs from traditional money

Bitcoin represents a fundamental shift from traditional money (often referred to as “Fiat”), offering a system that operates without centralized control. Unlike government-issued currencies that can be printed or altered by policy decisions, Bitcoin follows transparent, fixed monetary rules enforced by a global network. This design aims to provide greater supply certainty, auditability, and long-term purchasing power protection. Here are some key differentiators about Bitcoin:

1. Decentralized

   1. Unlike traditional currency, Bitcoin is decentralized meaning that it cannot be controlled or manipulated by a single entity.

   2. Bitcoin operates on a global network of independent nodes (computers) and miners.

2. Supply Control

   1. Traditional currencies can be printed/created by central banks, allowing rapid expansion of the supply during economic or political decisions

   2. Bitcoin has a finite supply and follows an automated issuance schedule that cannot be changed. 

3. Transparent

   1. Every transaction is recorded on a public ledger, the blockchain, which anyone can view and verify at any time

   2. Its code and monetary rules are open-source so anyone can audit how the system works and confirm that there is no manipulation of it

4. Purchasing Power Protection 

   1. Its fixed supply of 21 million coins protects it from inflation so it can’t be devalued in the same way that traditional currency can be by printing more

   2. As demand increases over time, the supply remains the same which creates scarcity, and also helps to preserve and even increase its value relative to fiat currencies