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In parallel.
Yes, you are limited. If one 12V down-light requires 50W of power then 20 down-lights will require 1kW. Something's got to give as more down-lights are added. The voltage might drop so as each light is added they all become dimmer or the power supply might over-heat due to it working so hard. It's hard to knowing exactly how many down-lights you can put in parallel unless you have a power supply manufactured for down-lights and it has the manufacturer's recommendation.

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