I am not an economist, but I think that will need to test it first, so we will know what the result is.
There will be a trial and error before one system integrates with the other and that will need time to see how good is the result.
And that will depend on the government; maybe we will hear something from them.
And if everything can run properly, then maybe that thing will work with bitcoin.
Topic: Deflation based currency such as Bitcoin to counter promote economy. - page 4. (Read 12597 times)
May 10, 2019, 02:07:50 AM
May 10, 2019, 12:40:21 AM
No government would completely depend on BTC as their primary source of payment since that would be a foolish choice here. BTC is still an extremely volatile currency due to which it is highly unstable and many basically view it as an asset primarily.
In my view, since we are living in a very diversified world even if there will be massive adoption of Bitcoin it does not mean that it will be used as the exclusive medium of commerce and domestic and international commerce. Bitcoin then can be a very good and very attractive choice but there will be no monopoly as that can be detrimental to any economy. Bitcoin is not coming to the global choice to limit the choices of the people. Right now, there are still limitations that Bitcoin is facing though it is evolving.
May 09, 2019, 09:09:11 PM
Seems this situation is a bit illusory. A deflationary economy would make goods cheaper even more, but at same time, your salary, your income would decrease as well, thanks to this deflation. It would worth to save money in an economy like that more than in ours, but if many people aim this, it would hurt the economy anyway, as the money needs to keep circulating, like our blood in our bodies to keep us alive.
May 09, 2019, 08:08:02 PM
Currently, all major currencies issued by the government have natural inflation of about 2%.
Bitcoin, on the other hand, is much different, it, in fact, does not have any inflation but deflation.
Bitcoins are created less and less and the number of users does not affect the quantity of creation of Bitcoins.
Inflation on a low level promotes spending while deflation in Bitcoin promotes holding...
My question is, would an economy with a deflation based currency such as Bitcoin work?
Bitcoin, on the other hand, is much different, it, in fact, does not have any inflation but deflation.
Bitcoins are created less and less and the number of users does not affect the quantity of creation of Bitcoins.
Inflation on a low level promotes spending while deflation in Bitcoin promotes holding...
My question is, would an economy with a deflation based currency such as Bitcoin work?
As if the government would accept bitcoin to replace fiat just to avoid inflation. Bitcoin will never be a solution for i flation, if so, this would've solved the hyper inflation Venezuela had faced.
May 09, 2019, 06:03:00 PM
Isn't Bitcoin being mined everyday? I thought this was some kind of controlled inflation. We believe that no one's will change the cap limit. But it is still possible that a government fork Bitcoin and change this limit.
May 09, 2019, 05:35:52 PM
More you print money more the currency decrease. 20 years ago with $1 you could buy a coca-cola bottle, today you can't even buy a stamp.
With Bitcoin, it does the opposite, because more time goes and fewer bitcoins to mine there are.
Keynesian Vs. Austrian Economics
http://multi-act.com/austrian-school-of-economics-vs-keynesian-economics/
https://fee.org/articles/it-s-not-just-keynesians-vs-austrians/
With Bitcoin, it does the opposite, because more time goes and fewer bitcoins to mine there are.
Keynesian Vs. Austrian Economics
http://multi-act.com/austrian-school-of-economics-vs-keynesian-economics/
https://fee.org/articles/it-s-not-just-keynesians-vs-austrians/
May 09, 2019, 04:53:36 PM
Currently, all major currencies issued by the government have natural inflation of about 2%.
Bitcoin, on the other hand, is much different, it, in fact, does not have any inflation but deflation.
Bitcoins are created less and less and the number of users does not affect the quantity of creation of Bitcoins.
Inflation on a low level promotes spending while deflation in Bitcoin promotes holding...
My question is, would an economy with a deflation based currency such as Bitcoin work?
I don't think it's that simple. The general presupposition making deflation bad is based on perfectly rational behaviour of customers. However, as we know, people are not the rational creatures economists want them to be. If one wants to buy something today, it's not likely one will wait a month to do that. Moreover, other factors should be considered. Here's an interesting article, reconsidering deflation: https://www.investopedia.com/articles/markets/111715/can-deflation-be-good.asp. Bitcoin, on the other hand, is much different, it, in fact, does not have any inflation but deflation.
Bitcoins are created less and less and the number of users does not affect the quantity of creation of Bitcoins.
Inflation on a low level promotes spending while deflation in Bitcoin promotes holding...
My question is, would an economy with a deflation based currency such as Bitcoin work?
May 09, 2019, 03:59:38 PM
Currently, all major currencies issued by the government have natural inflation of about 2%.
Bitcoin, on the other hand, is much different, it, in fact, does not have any inflation but deflation.
Bitcoins are created less and less and the number of users does not affect the quantity of creation of Bitcoins.
Inflation on a low level promotes spending while deflation in Bitcoin promotes holding...
My question is, would an economy with a deflation based currency such as Bitcoin work?
In my opinion, If Bitcoin reach a specific prices while it can only be divided by 8 decimals then it will have a little problem as a form of payment. Perhaps, Bitcoin can be just an assets to hold and can't be a form of payment anymore for a little amount of transactions. Of course this deflation model could works but only until it reach the limit. When the limit comes, there must be an upgrade from community so Bitcoin could fit again in society. Bitcoin, on the other hand, is much different, it, in fact, does not have any inflation but deflation.
Bitcoins are created less and less and the number of users does not affect the quantity of creation of Bitcoins.
Inflation on a low level promotes spending while deflation in Bitcoin promotes holding...
My question is, would an economy with a deflation based currency such as Bitcoin work?
May 09, 2019, 12:45:40 PM
No government would completely depend on BTC as their primary source of payment since that would be a foolish choice here. BTC is still an extremely volatile currency due to which it is highly unstable and many basically view it as an asset primarily.
May 09, 2019, 11:56:17 AM
Currently, all major currencies issued by the government have natural inflation of about 2%.
Bitcoin, on the other hand, is much different, it, in fact, does not have any inflation but deflation.
Bitcoins are created less and less and the number of users does not affect the quantity of creation of Bitcoins.
Inflation on a low level promotes spending while deflation in Bitcoin promotes holding...
My question is, would an economy with a deflation based currency such as Bitcoin work?
Bitcoin, on the other hand, is much different, it, in fact, does not have any inflation but deflation.
Bitcoins are created less and less and the number of users does not affect the quantity of creation of Bitcoins.
Inflation on a low level promotes spending while deflation in Bitcoin promotes holding...
My question is, would an economy with a deflation based currency such as Bitcoin work?
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