A store of value is an asset that preserves the owner's purchasing power (by rising in value at a rate greater than or equal to the rate of inflation). It is particularly important during periods of high inflation. Bitcoin is not only an excellent store of value due to its scarcity, it also resists change to its monetary policy because it cannot be controlled by a central authority.
Former Google engineer and Bitcoin writer Vijay Boyapati outlines the key features of a store of value below. A store of value must be durable, portable, fungible, verifiable, divisible, scarce, have an established history and be censorship-resistant. Bitcoin excels in many of these categories, with Bitcoin's biggest weakness being its relatively short 12-year track record.
As Boyapati points out: "Scarcity is perhaps the most important attribute of a store of value as it taps into the innate human desire to collect that which is rare." Bitcoin's supply cap of 21 million coins and its decentralized leader-less network make Bitcoin provably scarce. In the next section we'll explore scarcity in more detail. Bitcoin is currently 80% as scarce as gold (as measured by stock-to-flow). In 2024 Bitcoin is projected to surpass gold and US residential housing in terms of scarcity.