Our current system is debt-based. If you take out a loan/mortgage in dollars, the bank wasn't previously holding those dollars, they get created upon your agreement to repay. So "who in their right mind would hold the dollar" is already true today.
Under a Bitcoin standard, lending and borrowing will become less common, because it's tougher to pay off in a deflating currency. Higher risk of default means more stringent conditions for lending, which means fewer loans.
Bitcoin will be less and less deflationary going forward. We will have better tools to hold and spend our sats. Bitcoin is a fixed supply currency.
Currencies with inflation will go out of fashion.
It has to be deflationary if the economy grows because the same amount of Bitcoin will represent an increasing amount of goods and services on offer and it can only do that by lowering the price per good or service.
A deflationary currency discourages spending which in turn tampers the economy. It's Bitcoin's self defeating mechanism, or for that matter the self defeating mechanism of any fixed supply currency.
That's why the dollar had to be detached from gold. While the amount of gold is increasing it's nowhere increasing as fast as the economy.
I don't even know where to start ahahahaha
You could start selling Bitcoin for fiat while there are still greater fools.
Then create a better fiat that does a better job at growing and shrinking the money supply in line with a growing and shrinking economy to maintain stable prices.
This is covered in Silvio Gesell's "The Natural Economic Order" and the movie "Shillings from Heaven" that you can find on YouTube.
"That's why the dollar had to be detached from gold."
No, Nixon decoupled the dollar from gold in 1971 because some countries (e.g. France) were demanding to redeem dollars for gold as originally promised under Bretton Woods, but the US very likely did not have enough gold to cover the dollars it had printed.
I agree that a deflationary currency discourages spending compared to an inflationary currency, but I don't see that as a bad thing. It discourages *stupid* spending, and encourages *sensible* spending.
