Bitcoin Forum

What are your thoughts of Bitcoin and how it fits in the larger picture of global fiat base (liquidity)?

An excerpt:
https://macromon.files.wordpress.com/2017/04/global-monetary-base.png?w=640
https://macromon.wordpress.com/2017/04/26/the-chart-that-floats-overvaluation/ (https://macromon.wordpress.com/2017/04/26/the-chart-that-floats-overvaluation/)

"We have estimated a global liquidity concept called the “global monetary base” which is simply the sum of the U.S. monetary base and the world’s official foreign exchange reserves.   Since most of the official FX reserves — about 65 percent — are held in dollars most of the global monetary base is in the U.S. financial system."

Bitcoin cannot fit in. If you notice the actual amount of US dollars in Circulation versus the number of bitcoin in the circulation there is a huge gap. Even if we make 1 bitcoins value at 100 million dollars it cannot still fit in since the amount of bitcoins is short. Thus we can say that bitcoins cannot replace the US dollars as the official legal tender but in a way it will complement the fiat currency.

Yes, the difference in scale of supply are galaxies apart....
...I think if I'm reading the chart there's approx. $3 trillion USD cash monetarily-available in USA...and over $12 trillion USD cash held in FX reserves.

versus

Bitcoin is 21 million max supply of BTC (or current market cap in terms of USD: >$40 billion). Tiny.

But at some point....as Bitcoin's cap grows and grows, does it not serve as a check on fiat to discourage further inflating the USD-cash (any-fiat) supply? Ie eventually the authorities will lose control of faith in buying-power should they resume inflating it?

I would say not only bitcoin but whole cryptocurrency world will share trillion of $ as marketcap after few years. 100 billion USD what we have today is nothing if compared with the size of global economy.

Yes, look to other market, we can see 100 billion USD is very small than major markets in the world.
It only have 1% of the global market share

Yes, not only this but also;

Fiat around the world is heavily infested with:
-fraud (false claims & laundering & insurance-related & chargebacks)
-frivolous legal costs (lawsuits bogging the system down)
-corruption (crime official and unofficial - governments and gangs, banks and conartists)
-social obligations (debasement in value to keep up with payments from government or other retirement-obligations)
-fake credit (goods being transacted with credit-loss, replaced by inflation of monetary base rather than bringing perpetrators & source to justice)

adding to list:
-regulatory burden and its cost
-inflating fiat to keep stock market rising and to keep house-prices from collapsing
-keeping monopolies with internet access centralized and search engine crawlers centralized

I wonder when did, however many decades ago, did fiat system breakdown?

Yes not as a replacement....but as time goes on, if bitcoins market cap gets larger and larger (currently around $170 billion), will currency/fiat continue to increase in supply or will it contract?

Or will there be no bearing at all? Anyone have thoughts?