what's going on here is you insist on a binary way with no spectrum or nuance, that deflation can ONLY be positive. define "wasteful investment" for me and we'll talk. a hard cap is a knee jerk reaction to fiat inflationary insanity. understandable, but it's shitty monetary policy.

Wasteful investment would be something like - in this context - to being fooled by the fake/distorted market signals being sent out stemming from supply manipulation and more generally interventionism. This causes you to misallocate capital, which eventually, when the musical chairs stops, causes you to lose your capital. You were chasing the wrong thing, fooled by echoes and distortions. Scarce honest monies which can't be manipulated result in your purchasing power naturally increasing over time (against a backdrop of technological development and inflating fake fiat). Because of that, you think twice before spending, and this makes you wiser and more careful and thoughtful in your financial decisions. But, much like the computer example I also gave earlier, eventually you do end up spending nevertheless. The difference? It was more deliberate, more thoughtful, more measured. And that's a good thing!

You act like all deflation is bad, but it’s about what it encourages: investing only in what outperforms just holding hard money. "Wasteful" is backing losers that can’t beat that bar. You dismiss Bitcoin’s hard cap as a “knee-jerk reaction” — which just shows you haven’t engaged with the idea, not that it’s wrong. It’s a mark of intelligence to entertain a thought without accepting it. You can’t even do that. Your issue isn’t nuance — it’s letting go of the fiat mindset you’re clinging to.

Man what a discussion you guys are having. Youre not wrong you know, if your investment can't outperform a savings account it is not a worthwhile investment. But there's a problem with hard cap currency, it's worth noting no such currency existed in the world, ever, except bitcoin. That problem is this: I want to invest in some worthwhile endeavor, so I take capital and put it towards that endeavor. That leads to economic growth, which leads to increased value of the currency, because now more items chasing the same money, the opposite problem of monetary debasement. I can siphon some of the wealth from what you create via this process simply by holding currency. This is the exact inverse of the cantillion effect. So more people catch on to this. Hey, I don't have to produce anything with my sweat and imagination and capital, I can just get a little piece of what everyone else does by holding the money they want for it. What we have here is a very interesting tragedy of the commons, one of two particular ones caused by a hard cap supply currency, the other I've spoken about and you can find in my public bookmarks if you want. What this inevitably leads to is a stagnation of economic output, artificially, you can say that it is self regulating and that would be true more often than not, output stagnates so the money stops climbing in value so the people look for other avenues to gain wealth and start investing again. But it suppresses economic exploration, it has the exact opposite effect as fiat debasement has, where fiat debasement incentivizes valueless investment just to have somewhere to pur capital that doesn't lose value, this has the effect of people not creating as many amazing things as they otherwise would've. The self regulation regulates lower than natural and optimal, just like a continuous percentage of supply self regulates higher than optimal. Ideally, the concept of supply pacing exactly with growth of economic output is ideal, money never loses or gains purchasing power, the only way to gain wealth is to create it, and deciding not to participate costs you nothing. Of course, that's impossible. Behind that, a self regulating supply increase, that is, when the money goes up in value people produce more of it, otherwise they invest elsewhere, is fantastic. It can't be optimal all the time, but it is most optimal IMO. Gold has this property. The other one, algorithmic linear debasement, a flat amount every x periods of time, is also fantastic, it can't be optimal all the time, it smooths the effect a capped supply has and allows graceful reorganizing of the market indefinitely, but it still does downregulate economic production a little bit.

You’re right, a hard cap introduces new dynamics like passive rent-seeking where some benefit without contributing. But that’s not unique to Bitcoin, fiat has its own version with the Cantillon effect. The difference is Bitcoin’s version gets better over time. As the market matures and price stabilizes the free ride shrinks. People will have to innovate to earn returns not just hold. This redirects capital toward real value creation not just financialization. It’s a good thing for the system overall and for the average person even if a few lazy ones ride the wave for a while. Progress isn’t perfect but it’s directional. Bitcoin raises the bar and that’s a feature not a flaw.