How Mining Reinforces Scarcity

Bitcoin mining reinforces scarcity through its fixed supply and predictable issuance schedule. Miners compete to validate transactions and are rewarded with newly created bitcoins, called the block reward. However, this reward is cut in half roughly every four years in an event called a halving, which reduces the rate at which new bitcoins enter circulation. Due to the fact that the total supply is fixed at 21 million bitcoins, mining gradually releases coins at a decreasing pace, creating a deflationary system. Over time, this predictable schedule ensures that Bitcoin remains scarce, unlike fiat money (traditional currency), which can be printed without limit.