What Is Bitcoin?

The short version

Bitcoin is a digital asset with a fixed supply. There will only ever be 21 million bitcoin. No company issues it, no government controls it, and no central party can create more. It runs on a global network of computers that anyone can join, and every transaction is recorded on a shared public ledger called the blockchain. Everything else is detail.

How it works

Owning bitcoin means holding a private key, a credential that proves control of a balance on the ledger. The ledger is maintained by thousands of independent computers worldwide that keep identical copies and verify every transaction against the network's rules.

New bitcoin enters circulation on a fixed schedule through mining. Roughly every four years, the rate of new issuance is cut in half. This is written into the software and has held since the network launched in 2009. The last bitcoin is expected to be issued around the year 2140.

Why the fixed supply matters

Compare Bitcoin to assets investors already know. Dollar supply is a policy decision. Housing supply responds to construction costs and zoning. Bitcoin's supply responds to nothing; it is fixed by code. That scarcity is the core of the long-term case some investors make for it, and it is why BTC Capital treats Bitcoin as a long-term reserve within the strategy rather than something to trade.

Scarcity is not a guarantee of value. Bitcoin's price has been highly volatile, with sharp drawdowns throughout its history, and past performance does not indicate future results.

Is Bitcoin the same as "crypto"?

No. Bitcoin is one asset within a much larger category. Most other digital assets have different structures: companies or foundations behind them, changeable supply schedules, and varying degrees of decentralization. When BTC Capital refers to a digital asset allocation, it means Bitcoin specifically.

Can it be hacked?

The Bitcoin network itself has not been successfully attacked since launch. Losses in the space have generally come from exchanges, custodians, or individuals mishandling private keys, not from the network. This is why custody, meaning how and where bitcoin is held, is a critical operational question for any fund that intends to hold it.

Is it legal?

Yes. Bitcoin is legal to own in the United States. The IRS generally treats it as property for federal tax purposes, and regulated products such as spot Bitcoin ETFs have been available to U.S. investors since 2024.

Where it fits in the fund

BTC Capital is developing a fund designed to pair income-producing multifamily real estate with a long-term Bitcoin allocation. The explainer on the hybrid fund structure covers how the two assets are intended to work together, and the Risk Management page covers the risks involved, which are substantial and include the possible loss of principal.