From what I've read about bitcoin, there is a fixed cap on the amount of money that can exist in the system, like various types of Austrian economists have desired.
Without being able to increase the supply of bitcoins, the economy will stagnate as the currency causes deflation. As deflation occurs, people horde currency, leading to lack of commerce.
This means that eventually when the coins have been mined you'll have an oligopoly of a few holders of a large amount of bitcoin, and then people participating in the real economy outside of it.
I am not hating on bitcoin because I don't understand it, I just don't think it has the flexibility to sustain itself in the long run, and so runs into the greater fool theory. Don't want to step on any toes, just my two cents.
Without being able to increase the supply of bitcoins, the economy will stagnate as the currency causes deflation. As deflation occurs, people horde currency, leading to lack of commerce.
This means that eventually when the coins have been mined you'll have an oligopoly of a few holders of a large amount of bitcoin, and then people participating in the real economy outside of it.
I am not hating on bitcoin because I don't understand it, I just don't think it has the flexibility to sustain itself in the long run, and so runs into the greater fool theory. Don't want to step on any toes, just my two cents.
limited supply hasn't stopped gold and friends from being a great store of value over time.