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that doesnt hold for a deflationary currency
by almosthere 2y ago
that doesnt hold for a deflationary currency
- troupo 2y agoIf the value of your coin only goes up in value, why would you use 1 bitcoin now to buy a pizza slice if you can use it 5-10 years from now to buy a house?
- oneeyedpigeon 2y agoA house in 5-10 years is nice, but it doesn't stop me from starving to death today.
- hagbarth 2y agoI think it was just an analogy. The incentives are to defer purchases, if possible, which lower economic activity overall.
- oneeyedpigeon 2y agoSure, my point was that there are many reasons someone might spend money today that might be better off saved for the future, however much it may increase in value.
- troupo 2y ago> there are many reasons someone might spend money today Yes, because that's the value of money. Bitcoin isn't money. It's a speculative asset precisely because people are hoping its value will only go up.
- oneeyedpigeon 2y agoI'm speaking from experience. I literally spent Bitcoin last week that I would rather have held, because I needed the money.
- robertlagrant 2y ago> It's a speculative asset precisely because people are hoping its value will only go up. This is the same for any currency trading.
- fastasucan 2y agoYes, bur you dont want to limit your populations spending to just those essential items.
- dlubarov 2y agoThere are other ways to encourage spending though, like a wealth tax. Not that I necessarily support it, but that would be the more comprehensive solution to hoarding, since it couldn't be worked around by just exchanging fiat for other assets like gold.
- freejazz 2y agoAnd who doesn't want to live in an economy where your purchasing decisions are made with the hunger of starvation!
- lxgr 2y agoThat's exactly the problem: People will (rationally!) limit their spending to bare necessities if they expect the currency they have on hand to strongly appreciate over time.
- npoc 2y agoImagine that, having the option of saving your money for things you really want instead of being forced to spend it on things you don't, or risk lending it out for essentially free to compensate for the continuous fall in value.
- Ferret7446 2y agoThat implies that 1. it is a problem and 2. that people are rational. The latter is definitely not true, and the former is definitely arguable.
- deleted 2y ago[deleted]
- motorest 2y ago> that doesnt hold for a deflationary currency I think crypto proponents in general share this inability to understand the fact that one of the most basic traits of money is stability of it's value, and anything that fails to meet this basic requirement is simply useless as a currency.
- GoblinSlayer 2y agoUseless after IMF bribed you with a huge pile of money.
- npoc 2y agoBitcoiners understand it well. They realise that in order to stabilise in value and become a unit of account, it has to grow close to it's ultimate potential as a store of value first. Which in the case of bitcoin is potentially well over $100T market cap. This is why El Salvador is likely willing to back down in the currency aspect for now and focus onto accumulating and holding bitcoin reserves.