Bitcoin alone doesn't make the greatest payment system, but it needs comparing to gold for its best physical analogue. With physical gold, confirming it takes e

Bitcoin alone doesn't make the greatest payment system, but it needs comparing to gold for its best physical analogue. With physical gold, confirming it takes expertise, special equipment and time. It has a huge attack surface for fraud, which is why it is impractical for everyday payments. Bitcoin is superior to gold in many regards: it is very easy to validate, it requires no physical storage, it is very cheap to transport, and very easy to divide. The systems which are being built on top of bitcoin will enable the use of the currency in practical payment systems: instant transactions, very low fees, and automation - some of which on a scale which was never previously possible because of the high cost of payments in existing payment systems. Systems like the Lightning Network will enable the creation of brand new economies which were simply not possible to do before bitcoin. In terms of deflation, bitcoin is also more similar to gold - it cannot simply be created out of thin air, and must consume energy to extract from the earth. The deflationary nature of bitcoin, and gold before it, make it an excellent store of value, even if it is not the most practical solution for national economies which, according to Keynesians, require stimulation through inflation. The money people are using for their payment systems does not necessarily need to be backed 1-1 by real bitcoin. We can already see some services like conbase are taking custody of people's money, offering debit cards to consumers and Point-of-Sale services to merchants. These will enable the everyday use of bitcoin without any strain on the bitcoin network, and without it necessarily being backed 100% by actual bitcoin. These may benefit their users by providing convenience, but can only work for as long as the providers are sufficiently responsible as to not become insolvent. There are plenty of people who will refuse to use such "fiat bitcoin" services, and will only ever use bitcoin proper. This makes it kind of difficult for conbase and the like, whose fiat bitcoin will end up trading at a lower rate than bitcoin proper - and who will probably try to counter this damage by preventing withdrawal of bitcoin proper from their digital coffers, making their fiat bitcoin only spendable to merchants who will accept fiat bitcoins. They are essentially, trying to recreate the existing banking system on Bitcoin. There's a big difference between the banking system and bitcoin though, and that is permission. Nobody needs permission to use bitcoin proper, and given the choice of fiat bitcoin or bitcoin proper, those with sense will choose the latter. It doesn't matter that bitcoin is deflationary, because people will always act in their own best interest and acquire the most saleable currency, which will continue to be bitcoin proper. The opponents of deflation think that somebody ought to dictate the supply of currency, or that individuals should act against their own self-interest for the good of the many, but this is just a complete ignoring of the reality of human nature. People will always act in their own interest, and deflation is beneficial to ones own interest if they are intent on saving money. Unlike historical events where governments have threatened to send in their henchmen if people don't surrender their gold, bitcoin can not so easily be seized. Bitcoin does not care if you think that deflation is bad, or whether you think "expert economists" ought to decide how much inflation there should be. They are absolutely powerless against the force of Bitcoin. Everybody is. Nobody can control it, but everybody controls it through their own selfish interests. If this happens to lead to people accumulating and spending less, and this leads to economic depression, then that's what will happen! It might make you uncomfortable to think that you are no longer in control, but you're going to have to get over it. The die has been cast. If economic depressions end up occurring as a result deflation in bitcoin, we'll just have to find new ways of dealing with it, because Keynsian's forever money printing method has run its course.