Lesson 6: Scarcity (21M, issuance, halvings)

Goal: understand what “21 million” means, how issuance works, and what scarcity does not guarantee.

Beginner

Bitcoin is designed so there can only ever be 21 million coins. New bitcoin is created slowly over time, and every few years the amount created gets cut in half. That’s called a halving.

Intermediate

Miners receive rewards for adding blocks: a block subsidy plus fees. The subsidy declines on a fixed schedule. This is different from fiat money systems that can expand supply based on policy decisions.

• Cap: 21,000,000 BTC (rule enforced by nodes).
• Issuance: subsidy decreases over time (halvings).
• Long-term: miner revenue increasingly relies on fees.

Expert lens

Scarcity is enforced by consensus rules: coinbase outputs are limited by block height schedule. The economic question becomes: can fee demand sustain security as subsidy trends toward zero? That’s where settlement demand and layered scaling meet.