The value of all CURRENCY is closer to $5T putting an upper limit on value of about $240,000 USD (circa 2010) per BTC. Bitcoin replaces cash not fractional reserve account balances. Using global M0 is the apples to apples comparison.
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So what does this have to do with the OP point?
While the global money supply can (and probably will) inflate that would only increase the nominal PRICE not the VALUE. If the money supply doubles over the next hundred years then one would expect the price of BTC to also double but then again so would the price of everything else. If Bitcoin replaced all currency globally (not a scenario I find likely but good as an upper limit) we would expect the price to be on the order of $240,000 when measured in 2010 dollars.
...
So what does this have to do with the OP point?
While the global money supply can (and probably will) inflate that would only increase the nominal PRICE not the VALUE. If the money supply doubles over the next hundred years then one would expect the price of BTC to also double but then again so would the price of everything else. If Bitcoin replaced all currency globally (not a scenario I find likely but good as an upper limit) we would expect the price to be on the order of $240,000 when measured in 2010 dollars.
I have to disagree with Bitcoin replacing the M0 vs M1 or even M1+ part of M2 in fiat. There is a very important difference with Bitcoin the risk of a fractional reserve is very much higher that with a modern fiat such as USD largely because there is no central bank print more money in order to bail out a "to big to fail bank". Furthermore the deflationary nature of Bitcoin very much increases the risk of a lender that is short defaulting. Now one should ask the following question from anyone who has moved between fiat and Bitcoin: Was the fiat that was spent to purchase Bitcoin come from cash under the mattress (M0) or did it come from chequeing accounts (M1), saving accounts, money market funds etc. (M2) or even credit cards or lines of credit (M3)? A similar argument can be made for sales of Bitcoin for fiat.
On the other hand were the BTC on deposit with an institution running a Bitcoin fractional reserve that did not go bust?
