Quote from: Strofcon on July 13, 2010, 09:14:35 PM

I don't know that it's valid to say there is a fixed supply of bitcoins, because as has been discussed elsewhere in the forums, lost coins (lost/stolen wallets, hoarded coins on never-to-connect-again machines, etc) will not be recoverable in any way. So there's a cap on the number of coins that can be created over the lifetime of the currency, but the amount of bitcoins in circulation will not be fixed, as there will inevitably be lost coins as time goes on.

Now the divisibility of the coins is, as I understand it, what helps to insulate the currency against crazy deflation... but the economic discussions usually elude me, so I'm not 100% positive on that.

You have a point here; it would probably be good if there was a mechanism to regenerate lost coins, but I'm not sure how that could be implemented.

As Bitcoins become more valuable, people will increasingly take precautions. Therefore, the loss should decrease as time goes on. Losing 5000 BTCs worth $5 isn't such a big deal; losing 5000 BTCs worth $10,000 is!