Structural Supply Easing refers to a long-term reduction in the rate at which new cryptocurrency units enter circulation, or an increase in mechanisms that permanently remove units from the total supply. This phenomenon leads to a tightening of the available supply over extended periods. It can be a result of protocol changes, such as halving events in Bitcoin, or token burning mechanisms. This easing influences the long-term scarcity and economic value of a digital asset.
Context
News reports often discuss structural supply easing when analyzing the long-term price potential of cryptocurrencies, particularly Bitcoin’s halving cycles. The impact of such events on an asset’s supply-demand dynamics is a frequent topic of analysis. This concept is critical for understanding the intrinsic value proposition of digital assets designed with fixed or decreasing issuance schedules. It provides a fundamental perspective on the scarcity models driving cryptocurrency economics.
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