The value of Bitcoin have increased by 707% over the last year, and the average deflation is 96%
As the value of Bitcoin increases, it's owners would have a reduced incentive to do their job, and they would retire at a younger age(since they would have enough money to live the rest of their life). This would decrease the global productivity, even if the demand remains same(or even increase due to increased wealth). This would in turn increase the price of all commodities almost at the same rate as that of Bitcoin(law of supply and demand)
So even if your rich, and your net worth is increasing with increase in the price of Bitcoin, after everyone have adopted Bitcoins globally, even your richness wouldn't be that much rich, since the value of the things that can be brought with those bitcoins would actually grow the same rate as the bitcoin(due to decreasing productivity)
The illusion that the value of your Bitcoin wallet is increasing only works when you compare it with other currencies, and if every other currencies go extinct, the only way to measure our currency is by number of things that can be bought for one unit(purchasing power)
I'm not sure if that's how it works, correct me if I'm wrong(I'm not really an economist)
Well there is some truth buried in the argument you make.
It boils down to the fact that btc will only make some people rich.
So you need to tease out your idea and say BTC can only enrich a small percentage of the world.
pretend that to keep coins flowing they decide to take back stale accounts. This could recover one or two million untouched coins. Much like a bank closes account that have not been used for 20 years or so.
Next thing is calulate the worlds wealth at 210 trillion. (easy math)
so in 20 years the world moves To 420 trillion wealth.
say 210 trillion is btc
21,000,000 x 10,000,000 is 210,000,000,000,000 or 210 trillion
or half the money in the world.
so if the coin was spilt even 21 million people with 1 btc worth 10 million
that 10 million is worth about 5 million now.
What do i think would happen if 21 million people had 5 million right now.
It would be like you say wealth would shift.
But what will happen is the 21 million coins will not be spread like just said.
a few will have 100 or 200 or 1000 coins.
and a more will have 5,10,20
some will have .5 or 1
and a lot will be much smaller
so maybe only 10000or 20000 end up rich.
not 21 million
so huge demand will not happen since it wont be a huge amount of rich people .
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