[waterhouse]

> Being a man of better impulse control than you, and a prudent financial manager of his drug enterprise, he values 1 BTC in a year more than 1 BTC today. [...] expected value (after applying the deflation and factoring in risk of non-payment)

I think the status of that example as an alleged counterexample results from a subtle misuse of words. If the pot dealer's choice were between 1 BTC now and 1 BTC a year from now, the former is still of greater or equal value. If you are able to factor in "risk of non-payment", then you are talking about a decision between "attempting to get you to pay 1 BTC now" and "attempting to get you to pay 1 BTC during the succeeding year", which is by stipulation a materially different choice than "1 BTC now" vs "1 BTC a year from now".

As for the deflation--if the pot dealer believes that the increase in value from deflation is greater than what he could get by investing in his business (or in anything else), then he always has the option of sitting on the BTC for a year. The only reasons I can think of for this not to be the case are (a) if the pot dealer lacks impulse control and would spend it and regret it, or (b) if the pot dealer may be robbed of all his worth during the intervening year [so getting the BTC a year later is essentially a substitute for a safe money-storage service]. Both of these possibilities are generally assumed out of existence in this context, hypothesizing a hardheaded economic actor and a market with well-defended property rights.

[daveungerer]

> he always has the option of sitting on the BTC for a year.

Eureka! That's also known as bitcoin hoarding. If the value (in dollar terms) of holding on to bitcoin is indeed greater than spending it, people and financial institutions will hold on to it and primarily keep transacting in dollars. Which leads to a nice logical contradiction, since how can a currency be worth anything if no-one wants to spend it?