| > If useful, the US Department of the Treasury can issue a coin or bill with a value of any denomination, including .005 USD, and so is “infinitely divisible”. And how much does that cost? I bet it's more than 5 cents. > Bitcoin divisibility is limited, by design, to 0.00000001 BTC (1 Satoshi) Not by design, that's an implementation details that can easily be changed in the future if 1 sat starts to become valuable enough to make a difference. > and trades involving BTC slow or stop completely. Do you have an example of a single commodity in the history of humanity that simply stopped being traded because it became "too valuable"? I can't even understand how that makes sense, if it's valuable some people will want to sell it and get something that is more useful to them, like a house, a car, whatever. People don't commonly decide to hold an asset until their death bed. > But what happens to the “store of value” part of BTC if it is no longer the “medium of exchange”? What happened to Gold? |
The Great Depression.
https://en.m.wikipedia.org/wiki/Deflation#Deflationary_spira...
If you're looking for commodities only, it's easy enough to Google "commodities bubble".
https://en.m.wikipedia.org/wiki/2000s_commodities_boom#Opini...
The problem is that when markets get turbulent, they can suddenly shift to going the other direction. Instead of everyone wanting to buy, suddenly no one wants to be the last one out the door. And with Bitcoin, what authority is going to stop the panic?
> What happened to Gold?
I suppose it depends on which branch of Bitcoin you're on. Are we talking about store of value or medium of exchange?
Soros' comments on gold are helpful.
> “Typically, a self-reinforcing process undergoes orderly corrections in the early stages, and, if it survives them, the bias tends to be reinforced, and is less easily shaken. When the process is advanced, corrections become scarcer and the danger of a climactic reversal greater”.
http://blogs.reuters.com/great-debate/2010/09/30/gold-as-the...