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This does not point out a problem with early adopter advantage. BTC still appears to be a deflationary currency, which fundamentally favors the early adopter (though they may still screw up and lose that advantage). In a deflationary currency, over time, the cost of goods and services will trend towards smaller increments of the currency. Assume that the BTC economy stabilized, that it has a nearly consistent deflation rate similar to our nearly consistent inflation rates in other currencies. If you receive a salary of 100BTC this year, at a 10% deflation rate you would expect your salary the next year to be about 90BTC, and about 81BTC the year after. 7 years into the job (barring other pay raises) your pay is cut in half (in absolute terms), but can still purchase the same amount each year. Now, assuming a modest 30% savings rate, after about 15-16 years you'll have saved up more than you will earn over the next 15 years. So now my kid is grown and entering into the economy, in his first 15 years he'll have earned what you saved, but have a fraction of your wealth. 15 years after him another kid has grown and entered the market and faces the same dilemma. Today, BTC is unstable, the value fluctuates wildly, "early adopter" is a fuzzy term because BTC is still young. But this is the fundamental problem facing deflationary currencies over an extended period. The deflation rate, similar to the inflation rate for other currencies today, has to be tempered. If it's allowed to get out of hand it'll wreck the economy it's meant to facilitate. |