Everybody knows that hyper inflation is a huge problem. After experiencing serious hyper inflation, Zimbabwe disbanded their currency in 2009 and is now relying on foreign currencies.
Hyper inflation is only a serious risk for currencies that can have their supply arbitrarily expanded. This is not the case for bitcoin.
I don't know any examples of hyper deflation (because it is very easy to combat, you simply create money). But deflation led to people not investing or lending out money during the great depression, because they would rather keep their money which yielded a better and safer return.
The Great Depression was due to FDR and Hoover preventing wages from decreasing in nominal terms to adjust to the decrease in the money supply, which led to artificially high wages, but high unemployment.