This assumes the supply inflation rate of gold is ideal...
I agree there isn't an ideal, or it is too complex to ever understand and wasn't ideal anyway so not worth mimicking. The only similarity I draw to gold is in primitive times easy gold was found, with primitive tools, all easy gold was found before the primitive tools became obsolete and throughout the centauries technology advanced and with each advance new gold was discovered this is in my understanding of the evolution of the world, is somewhat appropriate. Bitcoin does not follow this trajectory which concerns me.
All I am stating is; it is probably advantages to the adoption (and propagation of the use) of gold that 50% of all gold was not uncovered millennia ago in primitive times, but discovered at a rate that is somewhat correlated with technological advances.
To the PO's point using the gold metaphor, I think if all gold (1 BTC) were available to one "king" (Satoshi) at the start and disseminated, there would never be consensus as to the value, and it would not spread equally even though it is practically divisible and finite. To use it as money would be problematic as those without it would be at the mercy of those with it. (You would need to have similar powers to that of a state to enforce its use)
The Bitcoin mining model is better than having it disseminated from a single source. But the Bitcoin model is still problematic.
And here is why:
Any new technology goes through an
adoption cycle statistically it is similar whether it is a printing press, a new fashion of shoes, an automobile or a farming technique and the
Laws of Diffusion of Innovations typically apply. (p2p Criptocurrency is one such revolutionary technology and will by it revolutionary nature propagate along the same lines, Bitcoin on the other hand is hindered by the market distribution mechanisms. "It is becoming too valuable to spend"
Here is how 100% of the total Bitcoin user's saturation will occur divided up into 5 groups:
1) The innovators 2.5% Battle to get Bitcoin off the ground - they get it and are motivated by the dream,
2) The early adopters 13.5% are the big winners who get into Bitcoin early before main stream adoption.
These are the guys that actually use it and build an economy to earn it.
3) The early majority 34% are the first to benefit from mainstream adoption,
4) The late majority 34% of the users who have to adapt or die, but missed out on the early benefits.
5) And the Laggards, 16% they are the dumb asses that refuse to acknowledge the benefits of a finite P2P Criptocurrency, but have to use it because it works.
Giving the innovators the first 2.5% have mined the first 50% of all coins, leaving the next 50% of coins to be divided up among 100% of total users (groups 1, 2, 3 and 4 and 5) now knowing group 3, 4 and 5 will unlikely mine but just be users, that leaves distribution of new coins to mostly to groups 1 and 2.
If you believe Bitcoin is going huge then we are still in the Innovators stage, total users today are less than 2.5% of all users to still adopt Bitcoin, (I hold this view and I can't logically justify it - I bout a shitload at $3 and mined a shit load more) my profit is insane, the wealth I have been given has to come from somewhere, and my future wealth has to come from Groups 2, 3, 4 and 5.
So my concern is if the cost of entry is high for groups 2, 3, 4, and 5 (they have to transfer wealth to me and the rest of group 1) to be a part of the BTC economy, and if it is a lot of wealth as I predict, the benefit* has to be huge to motivate them to adopt.
*Let's quantify the benefit. let's say I go all in: Take the 3% banking fees on a salary of $100K a year = $3000 so using Bitcoin is worth $3000 every year, + the 2% inflation the total benefits Bitcoin provide are $5000 per year so loosely speaking the quantifiable benefit is about 5% of the value of BTC. So to get the $5000 benefit I have to invest $100K of my earnings (wealth or labour).
Now if 10M people had to use Bitcoin today and say each has a yearly salary of $100K roughly speaking each user would have 1 Bitcoin, and each Bitcoin would have the purchasing power of $100K. The net problem is to join the BTC economy and receive the 5% benefit, you have to buy in and that wealth will go the group 1 and some to group 2. ( I predict it won't happen and I will not get $100K per Bitcoin for this reason.)
Experiencing the escalating cost of entry will discourage group 2 from growing by adopting Bitcoin. Leaving me to conclude that the
adoption cycle is probably in group 3 or 4 stage right now. Unless the price was to crash to single figures then the process of risk taking will start again in group 1 and growing of the user base starts again.
Now a better model will increase the distribution of new coins to better match the growth of the economy it can never be done correctly but it would be fundamentally structured to support market driven adoption if it followed the
Laws of Diffusion of Innovations. That way allowing massive adoption and benefit to go to a larger group of participants and fostering exponential adoption to a larger user base. And that way 21M coins can be distributed to 100's of Milions leaving the value of Bitcoin to be very high. (innovators and early adopters -group 1 and 2 still benefit in proportions that supersede that of getting in on apple or other similar tach stocks at inception, but allows the system to grow for maximum benefit.)
