Bitcoin Forum

I have recently learnt that people are trying to hoard coins as long as possible in order to increase it's price rise. And there are only 21 million coins in supply!

http://i.stack.imgur.com/tTVgM.gif

Now, let us assume that 21 million bitcoins are fully mined and 7.28 billion population (https://www.google.com/search?q=total+population+of+world&oq=tot&aqs=chrome.1.69i59l2j69i57j69i61l3.1806j0j1&sourceid=chrome&ie=UTF-8) all over the world gets to know about Bitcoin protocol and incidentally, everyone starts buying and hoarding 346.66666667 BTC (https://www.google.com/search?q=total+population+of+world&oq=total&aqs=chrome.1.69i57j69i59l2j69i61l3.10276j0j1&sourceid=chrome&ie=UTF-8#q=7.28+billion+%2F+21+million)! Then what might happen eventually?

I know this is an extreme hypothetical case and will not happen at all, so please don't reply just by stating that everytime.

Wow! This is a serious question right here :o ! Well, I think bitcoin will reach it's dead end since there won't be any transactions processed after that and the market price will eventually decline towards zero! :-\

7.28 10⁹ * 346.66 >> 21*10⁶ thus "every starts buying and hoarding" is not possible, there are not enough coins. If everyones goal would be to buy that much coins and everyones money supply would be infinite (we already assume infinte number of decimal places and time with the halfing you use) the price for one bitcoin would also grow to infinte. Bitcoin would never be used. Those that had more than the goal in supply would sell for a short time. Those that can not buy more because no one is selling would... i dont know, go mad?

Everyone can not hoard 346.66666667.
If 7.28 billion people wanted to own some bitcoin, and there were only 21 million (technically less) bitcoins in existence,
each person could only actually own around 0.00288461 btc.

So, to answer your question. "Then what might happen eventually?", the only possible answer is the price will rise, if people wanted some.

Edit: Shorena beat me to the answer by a few seconds.  :D

though i love the hyperthetical.. i prefer reality.. ignore the 7billion population.. as some of them are people who have medical issues, in prison, or are babies/toddlers.. (unable to be part of economic society)

so atmost you would see a 5billion population of actual people playing with and making free choices about spending.
we also know that upto 1mill coins are already lost.. gone..

so the potential free flowing bitcoin cap is 20mill coins..

now if everyone was equally given X bitcoin.. it would work out as 0.004btc per person.

now the hyperthetical exageration..
bitcoin being the only on world currency..

well at the moment average 'savings' are $45,000/person.
meaning 0.004btc=$45,000.. or put simply
in the dream utopia of bitcoin being the one world currency, with no other options. 1btc would be worth ATLEAST $11,250,000 per btc.

so now you have the utopian, wet dream perceived value of bitcoin..
can we now put the dreams and the speculation aside.. and just get on with getting retailers to accept bitcoin. you know.. make bitcoin actually more useful for everyday purchases of toilet roll and bread.. instead of specialist stuff..

Can both of you please explain mathematically how will a person get  0.00288461 BTC or 0.004 BTC only? Well, according to franky1, I think it'll round upto 250 BTC (https://www.google.com/search?q=5+billion+%2F+20+million&oq=5+billion+%2F+20+million&aqs=chrome..69i57j69i64.7446j0j1&sourceid=chrome&ie=UTF-8)?

In reality, perhaps the strongest argument IMO is the economical argument – If bitcoin “wins”, but its wealth remains concentrated in too few hands, it won’t be as useful to the rest of the world because of over-pricing and scarcity. As a result, this will be reflected in bitcoin prices, because the public will not be willing to pay the outrageous amounts demanded by the early adopters – in fact, it will make bitcoin lose a little bit, or not reach its full potential. In turn, this will motivate said early adopters to sell some of their stash (nobody likes to be on a losing horse), thus moving bitcoin to other parts of the population. Once the market believes this is no longer a problem, the price of bitcoin may rise to its optimum value. In short, the market will auto-correct any such problem.

This reminds me of these two memes!

http://i63.tinypic.com/6zvexs.jpg

http://i66.tinypic.com/2zstqfl.jpg

you confused billion with million, because 346 x 7B ain't 21M

what will happen is simple, the value of bitcoin will be enormous to accomodate the need for each people to have a tiny portion

you can get the fantastic 1M per bitcoin quite easily in that scenario, which would mean that every person , would have $2.5k in bitcoin