Re:The Evolving Economics of Bitcoin, Gold and Fiat Currencies
by wodenokoto on Thursday November 02, 2017 @09:44AM
(#15610319)
I get that people consider this a poor argument, but parent asked what the argument for bitcoins deflationary nature, and to the best of my knowledge this is the argument for it, and it is found within groups who identify with anarchistic economics and austrian schools of thought.
What might surprise you is that there are a lot of people who think that planned inflation is a way for governments to rob people who are prudent with their personal finance (and save up money)
If we are 10 people who each have 100 dollars, we have a money supply of 1.000, evenly distributed. If I'm the national bank and I print another 1.000, the money supply has doubled, while the value of the total money supply has remained constant. Only now, instead of holding on to 10% of the total supply, I now own 55%!
So as long as somebody have control of the money supply, it is not a free financial market. Limiting the money supply, either through the scarcity of gold, or cryptography of bitcoin ensures that the market will distribute money, and not the printers.