Quote from: EconomyBuilder on August 21, 2010, 10:35:36 PM

(2) The deflation can't be too big, or it will discourage later adopters who will think they're being scammed by a pyramid scheme. Also, according to some economists (hotly disputed by others) too much deflation can cause hoarding meaning fewer transactions being made in the currency. Is it true? Hopefully we'll get to find out.

You're confusing two different concepts. bitcoins are more similar to a commodity than a currency. When you think bitcoins think gold. Or the stock price of a publicly traded company. Holding onto these assets with the expectation that their value will appreciate is not bad for an economy. In fact, you aren't going to change any economy with bitcoins.

If the price of bitcoins is rising then that means bitcoins are successful. People are holding them for their value. That's what you want. It's not good or bad. If people worry it's a "pyramid scheme", then it's no different than people worrying about a bubble in the price of gold. People worry in all markets. If you didn't have worry then you would not have price discovery.

Don't forget that every time someone buys a bitcoin there is also a seller. So when someone bets that the value will increase, there is someone else betting the value will decrease.

In other words, it's all good.

I'd measure the success of bitcoins by the number of people that claim to hold them.