The supply of currency is fixed, so as its value grows the rate of return required to make an investment attractive increases. Eventually you only have HODLers.

The supply of currency is fixed, so as its value grows the rate of return required to make an investment attractive increases. Eventually you only have HODLers. If Bitcoin were the only currency people would be forced to spend it on essentials, but that's it. A less extreme version of this happened with gold, but gold is far less deflationary than Bitcoin. Bitcoin is absurdly deflationary. I don't think it was intended to be a Ponzi but there is no other outcome. Of course too much inflation is also very bad. The ideal in most cases is a very slight rate of inflation. There's a reason everyone abandoned hard currency. No country with hard currency has been able to compete. Flexible currency allows real world economic growth to be prioritized over monetary religion. Wealth is measured in goods, services, knowledge, health, etc. not bank balances. Of course the Fed system does have huge problems. It sucks, but it sucks less than most alternatives. I'll say stick with it until an actually better alternative is found. My favorite quote on central banks is from a colleague with a military background: the Fed is a weapon and abolishing it would be akin to unilateral disarmament. Countries with more flexible currencies like China would run right over us. He also pointed out that loose money (Reaganomics) is how we won the cold war. In the end it was not nukes or Star Wars but high deficits.