Wealth vs. Money
The concept of technology deflation trips a lot of people up. So here's a different way to look at it:
Wealth is comprised of all the combined things in the world that make our lives better: medications, airplanes, umbrellas, refrigerators, etc.
The amount of global wealth keeps growing because humans keep innovating, and the benefits of all existing technologies compound.
This compounding effect leads to an exponential growth in the amount of wealth in the world.
But, exchanging wealth requires a common good to a) solve a coincidence of wants, b) provide a pricing system, and c) temporarily store the value created.
This is usually the most salable and liquid good available. And this is what we term money.
"Money is not wealth. It's just something we use to move wealth around." —Paul Graham
Think of money as a vehicle and wealth as the cargo.
When the size of a vehicle is fixed (inelastic), but the amount of cargo is increasing, space aboard the vehicle becomes more valuable.
Similarly, when the supply of a monetary good is inelastic, but the amount of wealth keep increasing, the value of the money becomes the release valve.
Demand for using bitcoin (and holding is using) grows because it's the hardest monetary good to inflate and wealth creators will naturally seek it out to preserve the fruits of their labour.
Owning bitcoin is the only universally-accessible way to benefit from the combined ingenuity of humanity. And that's something I wouldn't want to bet against.
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