Your saying that deflation causes a currency to collapse. Id say this is wrong.
No, I didn't say that.
I said its economic role potentially sfifts from a monetary one to a utility one. In other words instead of investing in a potential cryptocurrency that sees adoption across many sectors of the economy, you're investing in a business with a fiat revenue stream.
The problem I see with that is not that it isn't potentially a successful revenue stream but that it changes the nature of the 'product' and makes it far easier for competitors to replicate.
Again, utility value and monetary value to NOT add. They are mutually exclusive roles in any economy. You don't add value to a monetary medium by giving it utility value - rather the utility value diminishes the monetary value by making it less efficient in a monetary role.