Quote from: ascent on June 25, 2011, 02:06:58 AM

In the far future, when for many years, it appears that only 1,000 Bitcoins are in circulation, the rest presumed lost, could someone dump a million Bitcoins on the market?

In this scenario, the presumed lost coins weren't really lost at all; they were saved. It does show that whoever saved those million Bitcoins have gained tremendously from saving. However, when they start to dump those coins onto the market, it would appear to be inflationary as the prices of everything goes up to reflect the amount in circulation.

It would be similar to someone finding a 2000 year old pottery and someone willing to pay $1m for it due to its presumed rarity. However, if a year later some finds a site with thousands more of those same pottery, the presumed value would drop significantly, even though the amount produced hasn't changed at all, only the ones in circulation.