Bitcoin Forum

Hi All,

It seems to me that people are incentivised to move towards a deflationary monetary system because if they just hold their money and do not spend, their unit of currency is worth slightly more over time. Particularly in contrast to inflationary monetary systems that most of us come from.

If you're a government, you're not going to aim for deflation because it means people will stop spending money in your economy and your economy will fail.

However, if you take the environmental conservationist standpoint, this could be seen as a great thing. It could curb our rampant consumerism & over consumption because everyone is incentivised to save.

Do you agree with my premise?
Would it be a good thing?

I look forward to your thoughts.
Thanks

If a currency is adopted by all merchants and there is deflation,the people will be motivated to spend more because all the price of goods and services will go down due to the deflation.The deflation doesn`t incentivise
saving money.Cryptocurrencies and bitcoin are completely different than fiat money.They aren`t accepted by all merchants and that`s why they are just digital "stocks" not currencies. 

hard to tell, in nature nothing last, it's contradictory thing, think about it for a second, in nature nothing last, we humans want to make store of value last it's hard fight.

Deflation by itself help the currency to be fortified and more valued even against the foreign currencies. Thus, a country that is experiencing deflation in currency is better situated and if managed very well would exchange stronger when goods are exported.

It encourages better standard of living too because goods and services will be available with lower monetary value.

Deflation destroys economies by forcing currency holders NOT to spend their money.  It is for this reason that the actual word cryptocurrency is a misnomer because it is not truly a currency at all.  Most of all cash coming into bitcoin is only used as a store of value.  If there is to be an actual cryptocurrency that breaks into the mainstream, it will have to be INFLATIONARY.  This will cause people to use the technology as it was supposed to.  This also has the benefit of keeping the price more stable instead of > 20% fluctuations on a daily basis.

I don't believe this is correct. If the currency is deflationary, it means that in the future the price tag will be lower on goods and services (as you identify). So, why would I go buy a new bike today when I could save my money and buy it later for less?

Sure, some crypto's are used only as a store of value. Bitcoin's current use case scenario seems to be best at this but it will evolve. There are so many people working on scaling up the payment side and it was part of satoshi's original intended purpose. We shouldn't limit the platform to a store of value.



Could you please detail why exactly it would need to be an inflationary coin that could break into the mainstream?

Reason why people are holding their coin right now is because the value of the coin keeps on increasing right now. It is really hard to compare bitcoin with the current fiat system because it is being used like a trading stocks wherein you are just going to spend it once the price is high.

Because bitcoin can't be considered as a pure currency right now it is somehow considered as an asset that has a chance of having more value overtime. Unlike fiat currency that are experiencing inflation rate every time bitcoin is experiencing the opposite right now.

Yes it is though as you said bitcoin is unstoppable even now bitcoin has an incredibly large amount of value over even just months bitcoin can reach more than $1000 every month although some issues have been going but bitcoin has also an incredibly fast recovery from all that damage. So bitcoin as an asset is really a reliable one.