Bitcoin supply cap meaningless

[darenyu]

So can someone explain what the difference is between a fiat currency with no supply cap and a crypto currency that has a supply cap but is infinitely divisible.

[Almat]

Divisibility doesn't really increase the supply, so it doesn't alter value in any way. If you have 1 bitcoin and slpit it for your two children, the total supply won't increase.

[darenyu]

My point is there will never be a supply shortage of fiat or bitcoin (as its infinitely divisible) so why do people state the 21 million hard cap is of any benefit.

[Xavofat]

My point is there will never be a supply shortage of fiat or bitcoin (as its infinitely divisible) so why do people state the 21 million hard cap is of any benefit.

Because it makes BTC disinflationary (or arguably deflationary) once it reaches its supply cap.

A lot of people are disillusioned with the creation of money by retail banks and by governments on a whim, and they think that the current fractional reserve system in which none of the money is backed by a scarce asset is unsustainable.  That's part of why BTC has a cap.

Sure, the exact number is arbitrary, but that's fine as long as it stays the same.

[nexus2k14]

So can someone explain what the difference is between a fiat currency with no supply cap and a crypto currency that has a supply cap but is infinitely divisible.

The difference is fiat currencies are controlled by the government and have no real value because they not backed 100% by gold. If you can print more money value is decreasing and inflation goes up. Bitcoin has total supply and is not free to "print" like fiat, more people in future will want to have or use btc - value will rise.

[mOgliE]

My point is there will never be a supply shortage of fiat or bitcoin (as its infinitely divisible) so why do people state the 21 million hard cap is of any benefit.

It's an important benefit:

On classic currency supply is infinite. Which means that government and people might try to raise the total amount of the currency while not creating the wealth corresponding. So the currency loses parts of what's it's worth.

On bitcoin, currency is 21 million and that's all. That means that if total wealth raises, value of each bitcoin raises too.
BUT and that's why it's so incredibly great, each bitcoin can be divided indifinitely so there is no way we lack of coins at one point contrary to cash if there was a limited amount.

See how it's all in all a freaking win win situation? ^^