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I know you are being snarky, but i think its worth pointing out that ever increasing prices is bad for a medium of exchange not good. The higher prices decrease

I know you are being snarky, but i think its worth pointing out that ever increasing prices is bad for a medium of exchange not good. The higher prices decreases the liklihood of it being used like a currency.

yunohn 2y ago
Yes, absolutely. But that’s exactly the problem. What is crypto - currency, investment, technology, religion? Apparently for all the crypto people I know, it’s somehow all of the above.
- dragontamer 2y ago
  Its a thing you buy that will go up in value as Trump, Elon, JD Vance, and RFK Jr. enter power. Its about that simple now. Whether or not that's good for the country (IE: does anything useful) is irrelevant now.
jsbg 2y ago
by that logic people would not buy TVs or memory cards
- lesuorac 2y ago
  Errr, by their logic people wouldn't use TVs or memory cards as "cash". Which they don't.
- kragen 2y ago
  TVs and memory cards keep getting cheaper, not more expensive.
  - jsbg 2y ago
    yes, that is what deflation is
    - kragen 2y ago
      The deflation of a currency is when the currency gets more expensive, not cheaper. It's true that other goods get cheaper when measured in that currency. But what we're discussing here is whether, and how, the continued deflation of Bitcoin discourages its use as a medium of exchange, not whether some hypothetical deflation of the dollar would discourage the use of other goods such as memory cards and Bitcoin as a medium of exchange.
      - itsoktocry 2y ago
        >The deflation of a currency is when the currency gets more expensive, not cheaper. This is a perversion of the economic definition of inflation and deflation. Inflation is the rate of change of prices.
        kragen 2y ago
        These are two different ways of looking at the same thing, but the crucial issue here is the direction of inflation: inflation is when prices, measured in the currency in question, go up, not down. That is to say, the value of the currency, measured in terms of any given good, goes down, not up. jsbg was getting this backwards, and your comment isn't helpful in clarifying their confused thinking. Historically speaking, the "printing too much paper money" definition of "inflation", which is more or less what you're saying is "a perversion of the economic definition of inflation", preceded the "general increase in prices" definition you're talking about: https://en.wikipedia.org/wiki/Inflation#Classical_economics https://en.wikipedia.org/wiki/Inflation#Classical_economics
    - lottin 2y ago
      Deflation is a fall in the general price level. A fall in the price of some goods or of a particular good is not deflation.
- bawolff 2y ago
  My logic is not that people won't but memory cards, but that they won't replace usd as a medium of exchange. As far as i am aware nobody uses memory cards as a medium of exchange so looks like my logic holds.
kragen 2y ago
It seems implausible that its price will increase forever. If your concern is that a bitcoin is an inconveniently large unit of value, like a kilogram of gold, you can subdivide it into individual satoshis even on the public blockchain, and at the current price of roughly US$100k per bitcoin, a satoshi is roughly a tenth of a penny, which seems adequately subdivisible to me. If Bitcoin improbably ended up at US$10M per bitcoin, it would still be a dime, which is probably still okay.
- raincole 2y ago
  It's not the parent comment's concern (at all).
  - kragen 2y ago
    It's pretty unclear what that comment was talking about, and your comment doesn't help.
    - munksbeer 2y ago
      Not involved in the posts above but I'll explain. I own bitcoin. If it only ever increases in value, I'd have to be a complete idiot to spend it, when I have depreciating fiat to spend.
tootie 2y ago
When Bitcoin was conceived economists said it would have built-in deflation and it seems they were right
- lottin 2y ago
  No economist said that. Deflation refers to the behaviour of the price level. As such it isn't a property that assets can have.
  - tootie 2y ago
    The original intent of bitcoin was to be a currency so that's how it was evaluated. The point of this thread is that despite it's increasing popularity it has never functioned as a currency. Calling it an asset is dubious since it carries no equity nor pays a dividend nor is it tied to the performance of any institution. That's why I say commodity since it trades most akin to gold although gold (like most commodities) can actually be physically used for things.
    - npoc 2y ago
      The first step in the growth of any medium of exchange is to prove itself as a stable store of value. Otherwise it can't be used as a unit of account. And the first step in proving itself a stable store of value, is to begin storing value which is where bitcoin is at right now.
      - lottin 2y ago
        How does an asset prove itself to be a capable store of value? I say the first condition is that it must have a stable (non-speculative) demand, which bitcoin notoriously lacks, and can never have because it doesn't do anything. It doesn't exist physically, therefore it can't be consumed or used as raw material. And as a financial asset it's nobody's liability, so like an IOU that promises to pay nothing. In conclusion, bitcoin's market value is driven 100% by a speculative demand and that's not a basis for a reliable store of value.

yunohn 2y ago

Yes, absolutely. But that’s exactly the problem. What is crypto - currency, investment, technology, religion? Apparently for all the crypto people I know, it’s somehow all of the above.

dragontamer 2y ago
Its a thing you buy that will go up in value as Trump, Elon, JD Vance, and RFK Jr. enter power. Its about that simple now. Whether or not that's good for the country (IE: does anything useful) is irrelevant now.

jsbg 2y ago

by that logic people would not buy TVs or memory cards

lesuorac 2y ago
Errr, by their logic people wouldn't use TVs or memory cards as "cash". Which they don't.
kragen 2y ago
TVs and memory cards keep getting cheaper, not more expensive.
- jsbg 2y ago
  yes, that is what deflation is
  - kragen 2y ago
    The deflation of a currency is when the currency gets more expensive, not cheaper. It's true that other goods get cheaper when measured in that currency. But what we're discussing here is whether, and how, the continued deflation of Bitcoin discourages its use as a medium of exchange, not whether some hypothetical deflation of the dollar would discourage the use of other goods such as memory cards and Bitcoin as a medium of exchange.
    - itsoktocry 2y ago
      >The deflation of a currency is when the currency gets more expensive, not cheaper. This is a perversion of the economic definition of inflation and deflation. Inflation is the rate of change of prices.
      - kragen 2y ago
        These are two different ways of looking at the same thing, but the crucial issue here is the direction of inflation: inflation is when prices, measured in the currency in question, go up, not down. That is to say, the value of the currency, measured in terms of any given good, goes down, not up. jsbg was getting this backwards, and your comment isn't helpful in clarifying their confused thinking. Historically speaking, the "printing too much paper money" definition of "inflation", which is more or less what you're saying is "a perversion of the economic definition of inflation", preceded the "general increase in prices" definition you're talking about: https://en.wikipedia.org/wiki/Inflation#Classical_economics https://en.wikipedia.org/wiki/Inflation#Classical_economics
  - lottin 2y ago
    Deflation is a fall in the general price level. A fall in the price of some goods or of a particular good is not deflation.
bawolff 2y ago
My logic is not that people won't but memory cards, but that they won't replace usd as a medium of exchange. As far as i am aware nobody uses memory cards as a medium of exchange so looks like my logic holds.

kragen 2y ago

It seems implausible that its price will increase forever. If your concern is that a bitcoin is an inconveniently large unit of value, like a kilogram of gold, you can subdivide it into individual satoshis even on the public blockchain, and at the current price of roughly US$100k per bitcoin, a satoshi is roughly a tenth of a penny, which seems adequately subdivisible to me. If Bitcoin improbably ended up at US$10M per bitcoin, it would still be a dime, which is probably still okay.

raincole 2y ago
It's not the parent comment's concern (at all).
- kragen 2y ago
  It's pretty unclear what that comment was talking about, and your comment doesn't help.
  - munksbeer 2y ago
    Not involved in the posts above but I'll explain. I own bitcoin. If it only ever increases in value, I'd have to be a complete idiot to spend it, when I have depreciating fiat to spend.

tootie 2y ago

When Bitcoin was conceived economists said it would have built-in deflation and it seems they were right

lottin 2y ago
No economist said that. Deflation refers to the behaviour of the price level. As such it isn't a property that assets can have.
- tootie 2y ago
  The original intent of bitcoin was to be a currency so that's how it was evaluated. The point of this thread is that despite it's increasing popularity it has never functioned as a currency. Calling it an asset is dubious since it carries no equity nor pays a dividend nor is it tied to the performance of any institution. That's why I say commodity since it trades most akin to gold although gold (like most commodities) can actually be physically used for things.
  - npoc 2y ago
    The first step in the growth of any medium of exchange is to prove itself as a stable store of value. Otherwise it can't be used as a unit of account. And the first step in proving itself a stable store of value, is to begin storing value which is where bitcoin is at right now.
    - lottin 2y ago
      How does an asset prove itself to be a capable store of value? I say the first condition is that it must have a stable (non-speculative) demand, which bitcoin notoriously lacks, and can never have because it doesn't do anything. It doesn't exist physically, therefore it can't be consumed or used as raw material. And as a financial asset it's nobody's liability, so like an IOU that promises to pay nothing. In conclusion, bitcoin's market value is driven 100% by a speculative demand and that's not a basis for a reliable store of value.