Inflation and Deflation in Bitcoin

8 min readarticleIncludes quiz · 3 questions

Bitcoin’s supply growth is predictable and decreases over time. That means fewer new coins each year (disinflation), trending toward zero inflation.

Simple definitions:

  • •Inflation (money): When the money supply grows, each unit buys less.
  • •Disinflation: Inflation that is slowing down.
  • •Deflation: Prices of goods fall over time.
  • •Hard cap: Bitcoin’s maximum of 21 million coins.
21 Million Cap
21 Million Cap

Bitcoin has a fixed cap (21M). Issuance declines via halvings, so Bitcoin’s “monetary inflation” trends toward 0%.

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