People losing their bitcoin or losing their keys does not make it Deflationary in fact that would make my stack more valuable
Discussion
Consider the following:
- I create a digital coin. There are 100 of them, fixed. Never any more.
- One person has 10 of these coins.
- Said person drops his phone in the toilet, ruining his key. Or he forgets his passphrase.
- His coins are effectively GONE from the system. They are cryptographically impractical to recover, and if they can be recovered, then the whole system is broken.
- There are now 90 coins, where there were once 100.
- The currency has deflated.
Now replace "100" with "21 million" and you have Bitcoin. It deflates over time.
Jeff Booth explains this! Read The Price of tomorrow…