A currency with no mechanism for monetary policy is not going to be adopted. Bitcoin is purely deflationary for more reasons than just people losing their keys.
For example, a fixed reward split between a growing group of miners will also cause a rising price floor. The miners will not sell for less than their electricity costs, which makes the smaller piece of the block reward they receive have a higher price.
So you have this asset you call a currency but it is always deflationary. No one will set prices in that. Think of it in terms of setting a salary. One month you are paying the equivalent of 1000 dollars, the next you are paying 2000. Since this has no way of stabilizing it will never become a true base currency.
Instead, at best, it serves as a pass through to a fiat currency. So it is acting as a payment processor but very inefficiently. Slow transaction speeds, expensive, difficult to acquire.
The price is driven by speculative demand. It honestly is more like a digital collectible than a currency (sign up to receive one of 21 million e coins, be part of history).
For example, a fixed reward split between a growing group of miners will also cause a rising price floor. The miners will not sell for less than their electricity costs, which makes the smaller piece of the block reward they receive have a higher price.
So you have this asset you call a currency but it is always deflationary. No one will set prices in that. Think of it in terms of setting a salary. One month you are paying the equivalent of 1000 dollars, the next you are paying 2000. Since this has no way of stabilizing it will never become a true base currency.
Instead, at best, it serves as a pass through to a fiat currency. So it is acting as a payment processor but very inefficiently. Slow transaction speeds, expensive, difficult to acquire.
The price is driven by speculative demand. It honestly is more like a digital collectible than a currency (sign up to receive one of 21 million e coins, be part of history).