Bitcoin 101: Digital Scarcity

Bitcoin solved digital scarcity by combining cryptographic primitives with economic incentives. Supply is capped at 21 million coins, distributed predictably over time through mining rewards that halve approximately every four years.

UTXO model and fees

Bitcoin uses the UTXO model: transactions consume previous outputs and create new ones. Fees are paid to miners and typically expressed in satoshis per virtual byte. Users can increase fee rates to prioritize confirmations.

Self-custody

Holding Bitcoin yourself means holding private keys. Use hardware wallets for significant balances, record recovery phrases offline, and test restores with small amounts to ensure your backup works.