I can tell you down to the day how many bitcoin there will be decades from now.
Can you do the same for any fiat currency for next week?
It offers stability and a mathematical escape from very fallible humans controlling monetary systems.
https://en.macromicro.me/charts/32355/bitcoin-supply-last-ac...
https://charts.bitbo.io/dormant-coins/
Edit: If I understand correctly around 15% of coins has not moved in even ten years. So more than 20% of all the mined coins up to mid 2015 have not moved since.
But the big issue from my point of view is not the actual key attrition rate but the uncertainty of the money supply, because from my point of view, these are the important questions about key attrition:
- If Bitcoin goes to zero, what order of magnitude of money will the investor class lose? 200 trillion dollars, 20 trillion, 2 trillion, 200 billion, 20 billion, or 2 billion?
- How much money and power has Bitcoin transferred to its early adopters: 2 trillion, 200 billion, 20 billion, 2 billion, or 200 million?
- How much impact could awakening dormant coins have on the market? If Satoshi, or for that matter Hal Finney's heir or another early participant, started liquidating his early coins, would that be a tenth of the usual daily trading volume? Ten times? A hundred times?
Questions like these are why lolc brought up key attrition in response to ducksinhats saying, "It offers stability and a mathematical escape from very fallible humans controlling monetary systems."
A key attrition rate of 99% or 90% to date would result in very different answers to these questions. But 20% or 50% to date is fairly minor in this context.
They also serve the network as a form of security bounty, let's say tomorrow we discover a way to break encryption "soon" pepople will be provided with a path to safer addresses but these old addresses, the ones for which a public key is known, act as an incentive to look for such security flaws.
You should ask them why they've generated about 58 million millionaires and 2,700 billionaires worldwide. That's some actual "hoarding" you should be concerned about, instead of concern trolling about Bitcoin.
Well besides common sense.
If you own a deflationary asset/currency which is guaranteed to appreciate as long as the economy is growing (well it wouldn’t if btc became a global currency but that’s another matter) there is no reason for you to invest into anything unless it offers a disproportionately high return (or buy goods/services now if you can delay buying them)
It would just reduce risk tolerance for investors and increase the real cost of borrowing significantly. That’s how deflationary currencies work (we know that based on several hundreds years worth of empirical evidence).
None of what you said applies to what I have suggested.
Imagine you take out a 30 year mortgage in 2025 with 12 periodic payments of .01 BTC a year.
Imagine offering a 10 year bond that will make quarterly payments of .01 BTC. What is the price of this bond? It is just a meaningless question practically.
As this story itself demonstrates, you clearly can't, and it already has the potiential to affect markets: "18.04 million bitcoin sits in dormant accounts. Sizable inactive accounts that wake up after years of dormancy draw investor attention because of the potential market impact if those coins are sold."
It's impossible for you to know if the accounts are dormant intentionally or because the owner has died or lost access - and in the latter case the coins are effectively lost or destroyed in every practical sense. So you can't even say how many usable bitcoins exist at this very moment, and it is even more impossible for you to tell exactly how many accounts will be lost in the future.
Can't do that with Gold.
This sentiment models a correction to a complaint I first heard with people who tell us everything fell apart since we ended the gold standard. They ignore that we raised all boats rapidly when we didn't pin everything to governments ability to fight gold hoarders for small amounts of gold entering the market. Even gold hoarders are better off in terms of what the market has created to exchange for their gold because that exchange ceased to be limiting on market expansion.
One could say the US economy was exponential both before and after the currency change, but as with Moore's Law, it gets harder to remain exponential if as few as one limiting factor is emerging.
How does that help, when the value it translates to doesn't stay the same? Also the conversion value will be impacted by changes in fiat currency.
But yeah, put 1% of your savings in each of the 20,000 coins with strictly limited supply. Their value must surely rise, right.
So what? if you say "scarcity", that by itself has no value. plenty of things are scarce, but are not valuable, no one wants it.
And anyway, bitcoin is not even scarce. there are thousands of other coins now, anyone can create one, these will / are diluting the $$$ going into btc
That’s the opposite of stability unless you have an entirely static economy with no growth.
Adopting an extremely deflationary asset as a “currency” is one way to get the no growth part I suppose. It certainly wouldn’t be stable.
We’ve (well some, anyway..) learnt that lesson with the gold standard and permanent boom and bust cycles prior to the 1930s. It was anything but stable in the short/medium term.
Hahaha what? Bitcoin has insane volatility.