Bitcoin may always be an alternate currency

Since bitcoin will be eventually deflationary, the interest rates will be higher than an inflationary currency like a fiat currency.

So merchants will choose inflationary money because it offers the opportunity to steal from the savings of others by changing money supply and the thus lowered interest rates.

Bitcoin may remain as a check on reckless fiat currency management. Since people now have a currency which cannot be confiscated except through rubber hose cryptanalysis bitcoin could become a better version of gold.

Unfortunately, Bitcoin scarcity is not objective like the laws of physics which make gold scarce, bitcoin scarcity depends on the subjective consensus of the majority about the protocol which can be wrong or worse: manipulated.

Consensus has always been prone to disagreements and disunity. And disunity and disagreements can be engineered so as to result in a hard fork of the blockchain.

This will be the way confiscation is pursued in Bitcoin.


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