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Let’s just say Bitcoin becomes the dominant money. What happens?
1) It becomes a true “store of value” and “medium of exchange.”
2) The only way to earn it is to produce something that someone else will pay you for in Bitcoin.
3) (Bitcoin * the velocity of Bitcoin use) = GDP
1) It becomes a true “store of value” and “medium of exchange.”
2) The only way to earn it is to produce something that someone else will pay you for in Bitcoin.
3) (Bitcoin * the velocity of Bitcoin use) = GDP
4) Bitcoin supply will be capped at 21 million BTC
5) Therefore, unless the “velocity” of Bitcoin use increases, there will be no inflation.
6) If the produce of the nation increases, then each Bitcoin will purchase more goods and services.
7) This is would cause deflation.
5) Therefore, unless the “velocity” of Bitcoin use increases, there will be no inflation.
6) If the produce of the nation increases, then each Bitcoin will purchase more goods and services.
7) This is would cause deflation.
8) More goods and services chasing a stable money supply leads to falling prices and a rising value of money. This is not necessarily bad.
9) However, when the US was on a gold standard, people rebelled because they didn’t like “hard money.”
10) Bitcoin is “hard money.”
9) However, when the US was on a gold standard, people rebelled because they didn’t like “hard money.”
10) Bitcoin is “hard money.”
