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bitcoin scarce supply unit of account 21 million btc satoshi nakamoto sats
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Why New Bitcoin Investors Shouldn’t Be Deterred By The Scarce BTC Supply

Tony Spilotro by Tony Spilotro
1 year ago
in Bitcoin
Reading Time: 3 mins read
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Bitcoin has recently caught fire with institutions, corporations, and hedge funds in 2020, as a defensive strategy to protect wealth against the non-stop money printing press that was turned on after Black Thursday.

The store of value and safe haven narrative is focused primarily on the cryptocurrency’s hard-coded scarce supply of just 21 million BTC. But a long-time crypto advocate and Fidelity Investments alum says that investors shouldn’t worry about the cost per coin due to an overall supply shortage and that because the asset is divisible the remaining units can be repriced and further split up if needed. Here’s why this sort of talk is the early signs of Bitcoin’s new narrative developing – where it becomes not only a “store of value” but a also “unit of account.”

Don’t Be Deterred By $20K Per BTC Prices Or Scarce Supply, Bitcoin Can Be “Repriced” Into Satoshi

Human brains are hard-wired to recognized and remember patterns, as well as finding the path of least resistance, reducing life’s challenges we encounter along the way and prolonging life expectancy.

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These reasons are exactly why assets often trade around rounded numbers, like $10, $1,000, $10,000, and $20,000, or at repeating numbers like $18,888 – a number you’ve likely seen flash on the price sticker recently.

Related Reading | Bitcoin Mathematics: Why 21 Million BTC May Have Been Chosen

As simple as it sounds, and it is, this due to how few movements of the finger it requires to place the order and how little thought goes into placing such an order.

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Ever wonder why Bitcoin has now topped out twice just before $20,000? That’s because smart money takes the extra few seconds to place orders that front run rounded numbers, leaving the lazy retail investors behind who didn’t plan properly.

btcusd bitcoin rounded and repeating

Bitcoin price often trades at rounded or repeating numbers  | Source: BTCUSD on TradingView.com

Humans also like to have whole numbers, and not a fraction of something, which is exactly why when Bitcoin gets this expensive, investors turn to altcoins.

However, Nic Carter, early crypto adopter and believer in Lockean property rights says that although digital scarcity is a key narrative for Bitcoin, there can never be a shortage of the ultra-rare asset. And here’s why.

It is true that only 21 million Bitcoin will ever exist, each BTC is divisible into one-hundred million “satoshi” – the smallest unit of measurement of the cryptocurrency, which translates to 0.00000001 BTC.

When or if Bitcoin becomes the global reserve currency and monetary revolution, or any such scenario where BTC becomes the primary store of value, each coin can be “repriced” further sat by sat, or even decimalized further if necessary.

Related Reading | The Dollar Losing A Decade Long Trendline Could Send Bitcoin Skyrocketing

In theory, even just one BTC could support an entire market, if broken down enough times, according to Carter and Bloomberg TV Editor Joe Weisenthal.

So before new investors FOMO into altcoins like the last crypto bubble, think again before you’re put off by the fact you can’t own a whole Bitcoin. What tiny fraction of BTC you can buy now, it could outperform thousands of other coins if it reaches its full potential.

The comments are especially notable, as the store of value narrative begins to take a backseat to the “unit of account” narrative that could transform the cryptocurrency from safe haven to global reserve currency over the next ten years.

Featured image from Deposit Photos, Charts from TradingView.com
Tags: bitcoinbtcbtcusdBTCUSDTcryptonic cartersatoshisatsUnit of Accountxbtxbtusd
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Tony Spilotro

Tony Spilotro

I'm Tony Spilotro. Behind the pseudonym, I'm a global remote work leader with a decade of award-winning content experience and excellence. Here, I explore my newfound passions pertaining to privacy, finance, economics, politics, cryptography, property rights, and other libertarian-esque views. I am a Bitcoin evangelist, maximalist, and educator whenever I can be, helping to spread its message of freedom from government control, monetary policy mismanagement, and passing the buck - literally – to future generations. My journey from a curious retail crypto investor to a serious Bitcoin advocate, trader, and technical analyst is an unusual one, but life-changing nonetheless and has become less about money and more about a long-overdue revolution. While a firm believer in the laws governing math and science, I am profoundly fascinated by the impact of astrology and astronomy including moon and solar cycles and planetary alignment and their ability to influence and potentially predict markets. It hasn't yet clicked for me as to how to put anything to use, but I consider it my current rabbit hole I can't yet dig out of. My perspective of growing up alongside the internet, the dot com era, the Great Recession, and roots in video games collecting coins and rare items caused Bitcoin to immediately make sense to me. Through all of these lenses, I seek to produce content that is educational and entertaining, and I thank you sincerely for taking the time to read what I have to say. Please follow me on Twitter at @tonyspilotroBTC and feel free to drop me a line if you would like to work together.

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