The Upper Limit of 21 Million Makes Bitcoin a Perfect Speculative Tool Instead of a Currency
Note: The article is written by an anonymous bitcoin holder.
Will Bitcoin become a world currency?
I guess it will be the next” scaling discussion” that would be dragged on for years. The answer is so simple: NO!
Isn’t it a common sense that any deflationary bias currencies are inherently speculative?
Let’s assume that the total supply of CNY is capped at the limit of 1000 million. If you have 100 million, it means that you are the top 10 richest person once and for all, which is like stealing wealth of the future generation. This is totally unacceptable.
The upper limit of 21 million is fatal to bitcoin, which makes it a perfect speculative tool instead of a currency.
Currency is not used as a general equivalent but a measure of social wealth. In other words, the significance of money is not to keep itself stable, but to measure the financial situation of society. If mankind is constantly creating wealth, if human labor still makes sense, then the meaning of money lies in its continuous depreciation and more printing to be in line with the actual growth of social wealth.
Hypothetically, when President Mao founded the New China in 1949, there were 57 kilos of gold in total that are as fixed as bitcoin. Mao gave one kilo of gold to the 56 ethnic minority groups and embedded the last kilo in the back of a live turtle. (I know it’s kinda weird, but just suppose he did it.)
68 years later, China’s GDP reaches over 570 trillion CNY and we are still in the time of gold standard, then one kilo of gold equals to 10 trillion CNY. That turtle who did nothing in the past 68 years now occupies 10 percent of China’s total wealth.
Do you realized how ridiculous it is? Only because the turtle lives long, it will take 10 percent of social wealth.
As long as we live in the world, we will keep creating wealth. However, if the total supply of money is limited, then no one would invest in anything. No one would spend a penny, because one penny will worth 100 CNY or more in the future. In the end, we will witness a return of a barter system for goods and services.
Anything that has an upper limit can become a great tool for speculation. The price of per bitcoin is＄2600 and that would be ＄54.6 billion for 21 million bitcoin. It is completely possibly that some bitcoiners could afford the money to manipulate the market.
What is the scariest part to manipulate a market? That is when you have a wrong market assessment. In the bitcoin market, however, you know exactly that when you hold 12 million bitcoins, you control 50% of the whole market and 90% when you have 18 million bitcoins. It would be very easy for these manipulators to leave the market at a good timing.