PS: I have no intention of cashing out.
Since BTC is deflationary I'd rather hold till each BTC is worth 100k. Check this thread in 2030 :)
Imagine if soy beans gradually went extinct. In the short-term, the prices would spike as companies reliant on soy beans compete for the shrinking supply. But as prices go up, these companies either go bankrupt, or find alternative inputs to replace soy beans. Either way, the prices eventually hit zero before extinction occurs.
The once plentiful and valuable becomes rare and worthless.
How does one define supply with a divisible unit like bitcoin? Arguably, supply does not diminish, rather people use smaller units of bitcoins.
Tldr; Bitcoin is deflationary because math.
Secondly, at some point, calculations become onerous. Like, if btc is $100k/coin, then normal, every day transactions will need to be in 0.000001 coins. Which is an incredibly annoying unit to work with, it's trivially easy to miss an order of magnitude, i.e., 0.0000001 at a glance, is that a dime, a dollar, or a ten?
Accidentally give a $100 instead of $10 once, and you'll be annoyed, do it twice and you're done using btc.
Further details: http://bitcoinchaser.com/bitcoin-units-and-denominations