Scarcity is a fundamental property of money.
Inflation, especially with the likes we see around the world, is devastating for everyone, and especially regressive.
Preserving purchasing power and savings is important for any money.
But does capping everything at 21 million go too far?
If we wave a magic wand and bitcoin takes over all forms of money, then not only is bitcoin preserving current purchasing power, but rather it is increasing purchasing power.
- World energy consumption was 173,340 TWh in 2019, a 63% increase from 1990 energy usage.
- World electricity consumption was 25,890 TWh in 2019, a 117% increase from 1990.
- Our world energy needs are dramatically increasing. By 2050, we are expected to consume 39% more energy than we do today.
So in effect, a bitcoin measured in energy alone, will increase to represent a larger share of energy - so it represents a larger purchasing parity.
What incentive do savers have to invest in businesses or help pull forward economic growth, when the terminal value of every investment can be measured in predictable value increase of each bitcoin?
And what about inheritance? Does having a large amount of Bitcoin saved over generations start to form new problems of inequality, since savings will rise against purchasing power (with no risk taking involved)?
Does my bitcoin accumulated today entitle me to a larger share of purchasing power in the future, due to the efforts of everyone else in society?
Just thinking out loud on this one - and part of this goes back to my earlier question on investing in bitcoin/lightning co’s here.
If anyone has any thoughts, readings, articles to suggest I’d love to hear it…