alani123
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May 04, 2017, 09:32:36 AM |
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If somebody wants to hoard bitcoin, more power to them. Nobody is holding a gun to a person's head forcing them to pay $10,000 for a single coin.. it's their choice. Owner of commodities invest in them because they want to hold onto or increase their purchasing power. You can use gold to buy shit, but it's also an investment. Same with bitcoin.
Using gold to buy shit isn`t an investment ,it`s a purchase. ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) I don`t see a problem with deflation,because a bitcoin can be divided into 1 million parts. One dollar can be divided only into 100 cents. Deflation and inflation aren`t a problem for bitcoin. I'm certainly very pleased with your optimism, but I'm probably a bit out of the loop. What difference can affect how many parts can be divided into a dollar or Bitcoin? In theory, bitcoin can be divided down to the Satoshi. But the growing amount of fees required to transact BTC doesn't make its divisibility all that of an actually usable feature. Bitcoin's microtransactioning nature has pretty much gone away as its popularity rose along with prices.
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Eebertay (OP)
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May 05, 2017, 02:46:05 PM |
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I was thinking about this idea of deflation / inflation and i realized i am seeing this from the perspective of fiat vs bitcoin
I dont think this line of thinking is really great but am unsure of which direction to go. This is the first time in human history we are dealing with a truly "global" currency.
I remember reading someones post in these forums of how he had saved up.012 bitcoin, which relative to him and his purchasing power in his country, this was an immense amount. I believe he stated his yearly earnings were about $250 usd.
With this example in mind, lets consider if bitcoin (hypothetically) did become the worlds reserve of wealth.
In terms of purchasing power, how would we perform transactions that addressed the parity of say buying a coca cola in his country vs the US?
Lets say in the US it was .001 (for arguments sake), because of the 1:1, there would be a complete disparity.
Unless i am missing something and not thinking this through.
Any thoughts?
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Xester
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May 05, 2017, 02:50:41 PM |
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I was thinking about how great bitcoin is vs combatting inflation but what about deflation?
Say bitcoin gets lost or if there was a malicious intent of destroying / hoarding bitcoin, are there any mechanics within bitcoin that address this?
Am curious but this is one of the largest problems i could think of if btc were ever widely adapted
The issues you are thinking is no longer a threat to bitcoin today. Bitcoin hoarders were never a problem since even if they hold bitcoin today surely they will use it or spend it later on. Nobody in their right mind will keep and hoard their bitcoins until they die. Thus even if there is hoarding in bitcoin it doesnt mean that bitcoin industry will stop.
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tigershark
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May 05, 2017, 02:52:08 PM |
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If somebody wants to hoard bitcoin, more power to them. Nobody is holding a gun to a person's head forcing them to pay $10,000 for a single coin.. it's their choice. Owner of commodities invest in them because they want to hold onto or increase their purchasing power. You can use gold to buy shit, but it's also an investment. Same with bitcoin.
Using gold to buy shit isn`t an investment ,it`s a purchase. ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) I don`t see a problem with deflation,because a bitcoin can be divided into 1 million parts. One dollar can be divided only into 100 cents. Deflation and inflation aren`t a problem for bitcoin. I'm certainly very pleased with your optimism, but I'm probably a bit out of the loop. What difference can affect how many parts can be divided into a dollar or Bitcoin? In theory, bitcoin can be divided down to the Satoshi. But the growing amount of fees required to transact BTC doesn't make its divisibility all that of an actually usable feature. Bitcoin's microtransactioning nature has pretty much gone away as its popularity rose along with prices. Correct, if bitcoin became so valuable that people traded sotashis, what would the fee be? It would have to be at least 1 satoshi for the fee, so the fee could be as much as the transaction.
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kelseydustin
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May 05, 2017, 05:17:32 PM |
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If somebody wants to hoard bitcoin, more power to them. Nobody is holding a gun to a person's head forcing them to pay $10,000 for a single coin.. it's their choice. Owner of commodities invest in them because they want to hold onto or increase their purchasing power. You can use gold to buy shit, but it's also an investment. Same with bitcoin.
Using gold to buy shit isn`t an investment ,it`s a purchase. ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) I don`t see a problem with deflation,because a bitcoin can be divided into 1 million parts. One dollar can be divided only into 100 cents. Deflation and inflation aren`t a problem for bitcoin. I'm certainly very pleased with your optimism, but I'm probably a bit out of the loop. What difference can affect how many parts can be divided into a dollar or Bitcoin? In theory, bitcoin can be divided down to the Satoshi. But the growing amount of fees required to transact BTC doesn't make its divisibility all that of an actually usable feature. Bitcoin's microtransactioning nature has pretty much gone away as its popularity rose along with prices. Correct, if bitcoin became so valuable that people traded sotashis, what would the fee be? It would have to be at least 1 satoshi for the fee, so the fee could be as much as the transaction. that is why Bitcoin can never became a good currency, the common kind of currency which will be used by everyone on this planet. I believe that ether or ripple will replace Bitcoin in the future
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XiaLang
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May 05, 2017, 06:27:08 PM |
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Sure, as people already explained earlier, if someone wants to spend his life savings for Bitcoin and then purposely lose access to them. They could do that. Right now the Bitcoin market cap is $25,686,663,870 USD. To put some perspective to this, there are less than 25 people in this world who have net worth higher than the Bitcoin market cap. This means that George Soros would have to spend his entire wealth to be able to theoretically buy ALL Bitcoins.
Also it is important to understand that if someone, let's say, bought Bitcoin for $1 billion USD it would have a huge impact on the market price and he could not keep up buying them with same price as he started with. If a person would buy $1 billion worth US dollar and decide to burn them all. The government would just print more and replace the missing money on the market, keeping the value same. However, if someone lost his Bitcoin worth 1billion, it would boost the value of the currency for those who still have access to their stash. No one can "print" more Bitcoin but we can divide Bitcoin to smaller units. This is what is going to happen when the demand rises and less coins are available on the market. Price goes higher and we will use smaller pieces of Bitcoin to purchase things. I am pretty sure that within 10-20 years, regular people could not afford to buy a whole (one) Bitcoin because the price will increase due to higher demand.
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The_Dark_Knight
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May 05, 2017, 08:29:21 PM |
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I was thinking about how great bitcoin is vs combatting inflation but what about deflation?
Say bitcoin gets lost or if there was a malicious intent of destroying / hoarding bitcoin, are there any mechanics within bitcoin that address this?
Am curious but this is one of the largest problems i could think of if btc were ever widely adapted
Bitcoin is a deflationary currency that is the way it was designed and there is nothing to be done about that, and that is not a problem at all, this is the same lie people spread about gold and not being enough of it, there is enough bitcoin we will just use smaller amounts than today if it was widely adopted.
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Qartersa
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May 06, 2017, 06:16:33 AM |
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I was thinking about how great bitcoin is vs combatting inflation but what about deflation?
Say bitcoin gets lost or if there was a malicious intent of destroying / hoarding bitcoin, are there any mechanics within bitcoin that address this?
Am curious but this is one of the largest problems i could think of if btc were ever widely adapted
To me, Bitcoin does not have a deflation problem because it is not a fiat. In fact, it is used as a medium to make normal currency transactions. Its supply is consistent, and hoarding it does not really help until its value is converted to fiat. The issue does not boil down on the amount of Bitcoins owned but its actual value when converted to fiat. Bitcoins only get lost when owners mistakably divulge or disclose the details of their Bitcoin wallet. Thus, the mistake can only be attributed to the latter. However, there was an instance when the owner's software was hacked thereby the Bitcoin wallet suffered the same fate -- i.e. losing all Bitcoins at once.
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Amph
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May 06, 2017, 06:50:43 AM |
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- snip - its deflationary - snip - as you can see growth drops - snip -
Come on franky1... You're smarter than that. If I start moving forward at 50 miles per hour, and every 4 hours I cut my speed in half (so after 4 hours I'm moving at 25 mph, and after 8 hours I'm moving at 12.5 mph, and after 12 hours I'm moving at 6.25 mph...) That doesn't mean I'm moving backwards. It just means I'm moving forwards slower. You're trying to play the same mindgame that governments play when they say "the deficit is shrinking". They hope the sheeple will confuse that and think it means the debt is getting smaller, when in reality it just means that while the debt is still growing, it is growing a bit slower than it used to. The fact that the growth rate (speed) is shrinking doesn't mean that the total supply is shrinking (deflationary). It's still inflationary (more exists now than before). It's a lower inflation (growth) rate, as you yourself pointed out in your example, but the inflation rate is still positive. It will eventually be deflationary (less exists at a given time than before), but only when the quantity lost or destroyed over a reasonable amount of time is more than the amount created over that same reasonable amount of time. there is however a difference between a inflationary slow rate with a limit(bitcoin) and a inflationary money without limit like fiat, you can't say they are both on the same boat, despite both are still inflationary one need to look at the total supply of bitcoin, which is limited, which make it already kinda deflationary aside form the emission rate, which is meaningless already(1800 coins per day) versus the already 16M+ mined
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Nagadota
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May 06, 2017, 07:30:06 AM |
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- snip - its deflationary - snip - as you can see growth drops - snip -
Come on franky1... You're smarter than that. If I start moving forward at 50 miles per hour, and every 4 hours I cut my speed in half (so after 4 hours I'm moving at 25 mph, and after 8 hours I'm moving at 12.5 mph, and after 12 hours I'm moving at 6.25 mph...) That doesn't mean I'm moving backwards. It just means I'm moving forwards slower. You're trying to play the same mindgame that governments play when they say "the deficit is shrinking". They hope the sheeple will confuse that and think it means the debt is getting smaller, when in reality it just means that while the debt is still growing, it is growing a bit slower than it used to. The fact that the growth rate (speed) is shrinking doesn't mean that the total supply is shrinking (deflationary). It's still inflationary (more exists now than before). It's a lower inflation (growth) rate, as you yourself pointed out in your example, but the inflation rate is still positive. It will eventually be deflationary (less exists at a given time than before), but only when the quantity lost or destroyed over a reasonable amount of time is more than the amount created over that same reasonable amount of time. there is however a difference between a inflationary slow rate with a limit(bitcoin) and a inflationary money without limit like fiat, you can't say they are both on the same boat, despite both are still inflationary one need to look at the total supply of bitcoin, which is limited, which make it already kinda deflationary aside form the emission rate, which is meaningless already(1800 coins per day) versus the already 16M+ mined The main difference is that fiat inflation is cumulative. If you hold your savings in a fiat account for 50 years and the inflation rate was 2%, it wouldn't be worth 100% less, it would be much more. However when the increase in supply is fixed (or in Bitcoin's case, decreasing) the relative inflation rate decreases each year. It's like what ETH says on their page. Who knows what they'll do with the supply in the future, but right now there's an additional of 18 million ETH per year, and they point out that while that means the supply is unlimited, the relative inflation rate decreases each year until it matches the amount of lost coins, at which point inflation would be zero. Currently, Bitcoin's supply increase would be about 3-4% of the total, which is nothing compared to how much the price is rising.
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