Why would it be unlikely? Because central banks all around the world have a lot of power, and they all have the goal of maintaining a steady rate of inflation. Moreover inflation is pretty much built in to the kind of monetary system that we have, rather than deflation.
But with trillions is unlevered debt sitting on the banks' book and unresolved public debt, a deflationary event is possible, especially if we get another black swan event like China's housing and banking system defaulting. This kind of trigger to send the world into a vicious spiral.
Bitcoins could, obviously, establish a new system of stored value which would make it tougher in the future for debt bubbles to inflate. But, if there is deflation in the dollar, would people hold onto fiat or would they seek stability in a new value store, like bitcoin?
How does the deflationary structure of Bitcoin behave in a fiat deflationary environment?
I think bitcoin will survive, but maybe the adoption would slow down a bit. I think that fiat price deflation due to perceived increased credit risk is likely soon, but the issuers of fiat could create more credit to counter it. If also trust in deposits accounts would evaporate, I think the literal money presses will go hot, maybe we will have simplified, easier to produce notes. Maybe we will see the reintroduction of prudent savings banks, which keeps all the deposits in store, possibly with only prudent lending where the timeframe of the loans and the timeframe of the deposits corresponds. Anyway, it will shake things up.
