Some long term sustainability analysis

[johnyj]

Suppose that bitcoin's value doubles every year, which means: If you accumulate 600 bitcoin, you can spend half of them 300 BTC, e.g. 30K USD to get a decent life for one year and next year you spend 150 BTC, still worth 30K, and next year 75 BTC, and so on

This is a very attractive retirement plan, many people will try to put part of their retirement money into this investment, and their purchase will further support the bitcoin price, guarantee the price doubling every year

This will be a long process until majority of people have saved in this plan and start to spend bitcoin, say after 10 years

Like government's retirement plan, up to the point of retirement of majority of people, there will be no problem, since there were mostly net inflow of money. But now government ran into huge problem due to more people are going for retirement, money net outflow and money value has been eaten by inflation (retirement plan is quite similar to a ponzi scheme that is dependant on the inflow of new money, all the saved money were turned into government bonds and money itself were spent by government, without a guarantee of return)

How it looks like for bitcoin in such a situation?

Something interesting will happen: By that time there will be many merchants accepting bitcoin payment, people do not need to sell the coin first, they will just directly spend the coin, and merchant do not need to sell the received coin either, they can just spend it at other places, so there will be minimum sell pressure on the exchange

So it is very different: There will be only money inflow into bicoin, no outflow. When you want to get bitcoin, the most practical way is to buy from exchange and you save it for some years, and start to spend them. When you spend bitcoin, you don't need to convert it back to fiat, you just spend it. The reason that people don't want to convert to fiat is very clear: Why exchange a currency that doubles its value every year into another currency which lose its value every year???

Furthermore, from tax regulation and FINCEN's point of view, if you spend bitcoin to buy goods/servies directly, you don't need to pay tax or register as a money transmiter

Is there any flaw in this analysis? Welcome to debate! 

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[empoweoqwj]

Here's a flaw. Its not an analysis.

Pre-supposing bitcoin is going to double in value each year is beyond stupidity, or as you put it, beyond imagination.

Again, you seem entirely concerned with "getting rich" from bitcoins than talking about the benefits / uses of bitcoin. Kinda sad.

[johnyj]

Here's a flaw. Its not an analysis.

Pre-supposing bitcoin is going to double in value each year is beyond stupidity, or as you put it, beyond imagination.

Again, you seem entirely concerned with "getting rich" from bitcoins than talking about the benefits / uses of bitcoin. Kinda sad.

Well, you can call that a very conservative projection, if you based on historical data, the value rised 10x a year by average

Isn't a market based economy purely dependant on that people want to get rich (profit from cerntain activity)?

Of course there is a concern that this will become a bubble and eventually burst, but just as my analysis showed, because bitcoin itself is money, people do not need to liquidate the bitcoin when there is a shortage of fiat money supply (typically when FED tightens).

Gold and silver's price crashed after FED indicated a tightening is on the way, but bitcoin not affected, because it is difficult to spend gold and silver to buy things, you have to first sell them to get fiat

[xxjs]

Here's a flaw. Its not an analysis.

Pre-supposing bitcoin is going to double in value each year is beyond stupidity, or as you put it, beyond imagination.

Again, you seem entirely concerned with "getting rich" from bitcoins than talking about the benefits / uses of bitcoin. Kinda sad.

Well, you can call that a very conservative projection, if you based on historical data, the value rised 10x a year by average

Isn't a market based economy purely dependant on that people want to get rich (profit from cerntain activity)?

Of course there is a concern that this will become a bubble and eventually burst, but just as my analysis showed, because bitcoin itself is money, people do not need to liquidate the bitcoin when there is a shortage of fiat money supply (typically when FED tightens).

Gold and silver's price crashed after FED indicated a tightening is on the way, but bitcoin not affected, because it is difficult to spend gold and silver to buy things, you have to first sell them to get fiat

I agree, it is a plan.