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If Bitcoin were to always increase in value (deflationary) there is a strong disincentive to ever buy anything with it. This makes it useless as a currency whic
by guelo 5y ago
If Bitcoin were to always increase in value (deflationary) there is a strong disincentive to ever buy anything with it. This makes it useless as a currency which means it can't replace USD. Why buy something now when you can buy it for less in the future? You could buy the famous pizza for a tiny fraction of a Bitcoin today
- eric_cc 5y agoAs long as we have fiat, bitcoin WILL always increase in value. Because bitcoin supply is capped and fiat will continue to lose buying power year after year. At this stage, there is no incentive to hold fiat and huge incentive to hold as much bitcoin as possible. If bitcoin replaces fiat, bitcoin becomes the main representation of value. It no longer goes up against a trading pair of fiat. I speculate that its buying power would stabilize and become fairly static.