Economists often complain about Bitcoin being a deflationary currency system.
They claim that the deflation of Bitcoin’s value will cause people to never spend any of the money they own, resulting in severe issues for the economy.
However, I think we should look at this from a different approach:
What’s going wrong ecologically on this planet is that we waste too many resources.
Now have a look at our current, inflationary currency system: Because money continuously loses value, people are encouraged to spend it on buying things because their value loss is more predictable, less severe, etc.
This encourages the production of things, resulting in the waste of resources.
They only issue is that Bitcoin mining and transaction validation will need lots of computing power forever, which of course causes lots of energy consumption. I hope that this issue will not dominate the effect of reduced production due to deflation.
But there is also some indication that in fact the energy consumption of Bitcoin processing might not grow too much: Very soon, Bitcoin mining will only happen on special hardware which was constructed solely for the purpose of Bitcoin mining (because its performance will be insane compared to “normal” hardware). In fact, such hardware already exists.
And this hardware is and probably always will be very very expensive.
Thus, the total amount of Bitcoin mining and energy consumption which will happen in the long term might not be very huge because there will only be a hand full of people who can afford the hardware.
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