The problem you point out is real; similarly Gresham's law. And while something like gold does have an intrinsic value based on its engineering uses, that value tends towards relative zero as the monetary bubble inflates. And I suppose you could say something similar about Bitcoin, with its intrinsic worth being the value of a distributed-trust ordering (eg timestamping) system, but I digress.

But the problem pointed out by the hard money enthusiasts is real as well. Once more tokens are being created for systemic reasons, a principle agent problem on who gets those newly created tokens is also created. In our present system it's the banking cartel, as they can spin it to sound as if they're impartial by loaning most of the money out. But they do take the first cut (points) and ongoing fees (interest) for use of the money that their privileges conjured, and nowadays have even dropped all pretense of being symmetric by stopping paying out interest.

We don't know what the resolution is between these conflicting frameworks (otherwise, the problem would be solved). But it's not particularly surprising that when the second problem grows in scope as it has in our modern society, benefiting the well connected while further eroding the power of the masses at the edge, that the first problem will be ignored while seeking refuge from the second.