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You are confusing scarcity and monetary hardness. Its super easy to create more sacks of garbage, and if demand for them shot up, a ton of people would bring th
by jkepler 5y ago
You are confusing scarcity and monetary hardness. Its super easy to create more sacks of garbage, and if demand for them shot up, a ton of people would bring their own sacks to market, crashing the garbage sack price. This happened to silver between the two sold wars, and nations that abandoned bimetal standards late lost a lot of monetary value to those on just gold.
Monetary hardness is whether its easy or hard to introduce more supply of a commodity money when demand goes up. More dollars are printed in response to demand, more gold mined in response to rising gold prices, more sacks of rubbish if that's what people clamor for. Dollars are harder money than sacks of garbage (unless we're talking about the failed Zimbabwe dollar), gold is harder than dollars.
However, more bitcoin CAN'T be created than the predetermined, declining schedule. Today, bitcoin's stock to flow is roughly equal to gold, but at its next halving it will double its hardness, and that will double again at every subsequent halving. So, bitcoin will become exponentially the hardest money ever created.
Scarcity is only part if monetary hardness. But perhaps you're right regarding future price: in the future (as is true presently), one bitcoin will be worth exactly 100,000,000 satoshis.