Post
Topic
Board Economics
Re: Bitcoin. In no way deflationary.
by
myrkul
on 04/05/2013, 18:40:19 UTC
Atm Bitcoin is inflationary due to the new coins mined.
But in the long run Bitcoin is deflationary by the amount of coins lost.

The article uses, as do you, a meaning of inflationary based on percent new coins added, but that isn't correct.  Inflation could also occur with fewer coins, with higher monetary velocity, or it could NOT OCCUR, with more coins, but with usage increasing at a similar rate as new coins.
It's common, especially amongst the Austrian types on this forum, to use inflation in it's original (monetary only) meaning, while others (typically the Keynesians and monetarists) use it in it's more modern price inflation meaning. If we're using the modern meanings of inflation and deflation, then Bitcoin is very strongly deflationary at the moment. If we use the original terms, then it's strongly inflationary, but demand is increasing even faster than supply.