RE: Sitting on the fence with Bitcoin?

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Sitting on the fence with Bitcoin?

in bitcoin •  8 years ago  (edited)

Bitcoin is deflationary, unlike Fiat currency (paper money).

No, it's not. There is a significant inflation as new coins are still being created in the process of mining, making Bitcoin actually quite inflationary. The inflation rate indeed decreases with time and eventually it will be zero but at this moment it cannot be called a deflationary currency.

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No, you are incorrect. The total supply of Bitcoin is known in advance, the fact that new coins are created until the total is reached does not make it inflationary at all. Inflation is the sustained increase in supply of a commodity or prices. Clearly there is not a sustained increase in the supply of Bitcoin over time because we know that firstly there is a fixed total supply and secondly the continuous supply decreases every 4 years or so. So calling Bitcoin inflationary at any point is an illogical argument.