31 Aug '13, 8am

Could deflation cause problems for bitcoin? - CoinDesk #litecoin

Could deflation cause problems for bitcoin? - CoinDesk #litecoin

Although it has been overshadowed in recent months by mostly regulatory news, the issue of deflation and bitcoins is still a topic worthy of debate. It was one of the biggest criticisms that faced bitcoin earlier this year as the price rose to an all-time high. Most of the bearish views on bitcoin deflation came from economists, who may or may not have understood the true nature of bitcoin. What is deflation? The general idea is that deflation is a decrease in the price of goods and services. In this case, we are specifically talking about bitcoins. As bitcoin’s value goes up, the cost of paying for things in BTC goes down as a result of an item’s fiat monetary value staying the same. This might trigger deflation, and some economists believe that once it starts happening, deflation will spiral out of control. Total bitcoins over time. Source: Wikimedia Deflation’s overall ...

Full article: http://www.coindesk.com/deflation-and-bitcoins/

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