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Don't we the customers and the capitalists already have the same situation with dollars? I could either buy a PS4 or I could buy some penny stocks. I could eith
by lumberjack 13y ago
Don't we the customers and the capitalists already have the same situation with dollars? I could either buy a PS4 or I could buy some penny stocks. I could either try my luck with a startup or I could put that seed money into a CD or a fairly low risk index fund.
So it all depends on the actual realistic rate of deflation if Bitcoin ever reaches widespread use.
- john_b 13y agoExcept that Bitcoin's intended purpose is as a currency, so to make meaningful comparisons you would need to look at other currencies or currency substitutes (gold/silver/jewelry/etc). Assuming that it reaches widespread use ignores the chicken and egg problem that producers of goods will not want to use it if the depreciation is too high. Currently you can spend bitcoins mainly through intermediaries and various online purchases that quickly convert the BTC to some fiat currency. I.e. pay a company for server space, they quickly turn it into dollars or euros to pay their electricity and employees. But to be a legitimate, full fledged currency it will need to both be a reliable store of value (low volatility) and be useful for producers (minimal depreciation). It has neither right now, and I personally don't see a path from the present state to that ideal equilibrium.