3 ms·
Because it ignores the velocity of money and total amount of transactions. If the USA suddenly adopted bitcoin as the official currency, you would see insane d
by rhino369 11y ago
Because it ignores the velocity of money and total amount of transactions.
If the USA suddenly adopted bitcoin as the official currency, you would see insane deflation. If people stopped using bitcoin as much, you'd see strong inflation.
Central banks manipulate money supply to keep prices steady.
That's why I can sign a loan for a house in dollars. But you would be insane to sign a loan for a house in bitcoin. The federal reserve will keep inflation from 0-2%. We can count on it. Bitcoin who knows.
- jsprogrammer 11y agoWhy would I need to sign a loan for a house in Bitcoin? With Bitcoin I can just buy the house outright. Debt currencies are used for signing loans. Anyway, there is probably a way to add an inflation metric over the blockchain based on it's length (or #transactions, or avg. transaction value, etc.), where some value equivalence can be drawn between older coins and newer coins, if it's really desired.