BlackRock’s statement casts doubt on Bitcoin’s supply limit, sparking mixed reactions in the crypto community. Implications for scarcity, network security, and investor confidence are at the heart of the debate.
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Is Bitcoin’s supply limit really immutable? BlackRock’s statement sparks debate about the future of cryptocurrencies.
On December 17, 2024, BlackRock, the world’s largest money manager, sparked a heated debate in the cryptocurrency sector. In an official video, the company stated that there is no guarantee that the 21 million Bitcoin limit will remain unchanged.
The statement has raised concerns about the fundamental value of the world's most popular cryptocurrency, causing market volatility and sparking debate about its scarcity.
Technically, the Bitcoin supply limit can be modified through a hard fork, an update that requires broad consensus among all network participants.
However, as SupertestNet, creator of BitVM and Bitcoin expert, points out, such a change would change the nature of Bitcoin itself:
“The inflation limit is the definition of Bitcoin. Without it, what’s left would no longer be Bitcoin.”
This view was confirmed by the community, who pointed out that the 21 million limit is one of the fundamental principles of Bitcoin, ensuring its scarcity and value over time.
The supply limit debate also has profound implications for Bitcoin miners. Currently, the block reward is 3.125 BTC, but this number will shrink to 1.625 BTC in 2028 due to the sharding mechanism.
This economic model raises questions about how the network can be kept secure when rewards are reduced, unless prices or transaction fees rise dramatically.
The main concern is that a less incentivized network could become more vulnerable to attacks, threatening the confidence of investors and users.
Mixed reactions in the community
The comments from BlackRock have divided the crypto community. Some, like Dash Pay’s CMO Joel Valenzuela, say a change in the supply limit is unlikely.
Others, such as Ethereum programmer Antiprosynthes, have suggested that BlackRock understands Bitcoin better than its backers.
This divergence of opinion fueled greater market volatility, with Bitcoin prices seeing significant swings following the announcement.
The debate over supply limits evokes the block size wars of 2016-2017, a period in which the Bitcoin community successfully resisted attempts to increase block size.
Although 95% of miners were in favor of the change, the proposal was not approved, demonstrating the power of consensus in the Bitcoin network.
This historical resistance highlights how difficult it is to make significant changes to Bitcoin without unanimous support from the community.
“`html future effects”`
According to SupertestNet, any attempt to modify the Bitcoin supply limit will require broad consensus among all stakeholders, including developers, miners, node operators, and investors.
This decentralized government system is designed to protect Bitcoin from outside influences, including those from large corporations like BlackRock.
However, the debate sparked by BlackRock’s statement highlights a broader issue: the growing influence of traditional institutions in the crypto world.
While on the one hand this effect could lead to increased adoption, on the other hand it raises questions about the future of decentralization and the independence of blockchain networks.