No. Deflation is even worse for economy than inflation is. That's why gold was abandoned. In fact, ancient China had a long history of struggling in awful situations caused by lacking copper/silver/gold for producing enough coins to feed the booming economy system, while the coins were either smuggled to neighbor countries or remelted by domestic speculators.

I propose a new digital currency be created according to certain eigenvectors[1] and allometry[2] features of trading network flows or simply the internet traffic flows.

The progress of Complex Network[3] theory may tell us more about how to build a solid algorithm for this kind of "evolving coins" to make them decentralized and evolve along with real economic activities.

I've been investigating the theory in part time and I dare say somebody with sufficient knowledge is able to figure out a model eventually.

IMO, bitcoin is the start of inventing a better currency, not the end.

[1]http://en.wikipedia.org/wiki/Centrality [2]http://www.nature.com/scitable/knowledge/library/allometry-t... [3]http://en.wikipedia.org/wiki/Complex_network