The answer to this paradox lies on this sentence:
And by adopt I mean adopt for payments, not hodl it as an investment.
The reason this paradox exists is because bitcoin is seen more as a long-term investment rather than a currency. It favors you to keep it instead of spending it and that's true as for speculators as for its deflationary nature.
Only if you put the advantages of it above this fact, you'll use it as a currency. So, in order to break this paradox, the people have to respect privacy, sovereignty and censorship resistance more than their capital appreciation.