How does the decentralized nature of blockchain support the value of Bitcoin?

You can understand it this way: the money we usually use, like deposits in a bank, is accounted for and managed by the bank, which acts as a "central" authority. The bank has the final say; if it says you have a certain amount of money, then you do. If the bank's system fails, or if it decides to freeze your account, there's not much you can do about it.

Bitcoin is different; it doesn't have such a "center," and this is what "decentralization" means.

Imagine it more like a public ledger for an entire village, where everyone records transactions together. Any transaction in the village, for example, if Zhang San transfers one Bitcoin to Li Si, isn't recorded by just the village chief. Instead, it's broadcast to the entire village, and all villagers (i.e., nodes in the network) record this transaction in their own ledgers.

This "everyone records together" method brings several core value propositions:

1. Security and Trust: Want to change the ledger? It's not that easy. If you want to secretly take back the money you transferred to Li Si, you'd have to modify your own ledger. But changing your own ledger is useless, because most people in the village have already recorded that you've paid. Unless you can convince more than half of the villagers to simultaneously lie and modify their ledgers for you, which is an almost impossible task in reality. Therefore, this system doesn't require you to trust any single person or institution; you trust the "strength in numbers" rule itself, which ensures your assets are very secure, cannot be denied, and cannot be altered.

2. Fixed Total Supply, No Unlimited Issuance: This "village rule" was set from the very beginning: the total supply of Bitcoin is capped at 21 million, and no one can change that. Unlike traditional currencies, where a central bank might "print money" to stimulate the economy when it's struggling, potentially devaluing the money you hold. Bitcoin has no "central bank"; no one can arbitrarily "mint" new Bitcoins. This scarcity, much like gold, is a significant source of its value. When something is scarce and more people want it, it naturally becomes more valuable.

3. True Personal Property: Because there is no central authority, as long as you keep your "wallet keys" (private keys) safe, your Bitcoin completely belongs to you. No one can freeze it, and no one can prevent you from transferring it to another person anywhere in the world. This absolute control over personal assets is very appealing in many specific situations.

In essence, decentralization is like establishing an extremely robust, transparent, and fair set of rules for Bitcoin. These rules are maintained by everyone collectively, rather than being dictated by a single authority. It is this rule-based trust, the scarcity of the asset, and complete personal control that collectively underpin Bitcoin's value.