How divisible are bitcoins? Can I divide a bitcoin? as in could I spend 0.5 or 0.01 of a bitcoin?
I ask this question as practically the production of new bitcoins is finite & will become too expensive in terms of time & power in the future and if the system becomes more popular there will be more goods than BC’s.
What about dwindling supply?
The current supply will eventually begin to dwindle as people lose their wallet’s(removing coins from the system) & governments attempt to drain coins out (either by scamming or creating coins themselves and simply hoarding them)of the system. This is inevitable (government action against BC) as no government worldwide will allow the existence of such an anonymous currency system out of their control or supervision.
What about the need for banks?
Actually I don’t think there would be a need for banks to get interest on savings, simply holding onto BC’s they will increase in value as more users come into the system. So technically you’ll get interest just for keeping them under your bed.
How are BC’s valued(this is more of a question for NewLibertyStandard)?
As I see it(thusfar) the value of bitcoins(as in their exchange rate or the goods they can buy) is not in how much energy/time it takes to create them (this simply ensures a limited supply) but that they are accepted for goods & services.
The more goods & services that can be bought with BC the less coins it will require per good.
For example there are 2 Million BC in existence, and only one person accepts BC, & is willing to sell a single t-shirt. Then the BC value of that shirt is 2Million BC, if it we’re 2 t-shirts then each shirt would cost 1Million and so forth.
Of coarse this may never happen exactly like this, a person would look at the electricity cost of making 2Million BC’s(in lets say US$) and the cost of buying the t-shirt(again in US$). If it costs $100 of electricity to make 2Million BC’s then of coarse the customer will just use US$ and pay $10 for the t-shirt.
Eventually at most only 21 million coins for 6.8 billion people in the world if it really gets huge.
But don’t worry, there are another 6 decimal places that aren’t shown, for a total of 8 decimal places internally. It shows 1.00 but internally it’s 1.00000000. If there’s massive deflation in the future, the software could show more decimal places.
If it gets tiresome working with small numbers, we could change where the display shows the decimal point. Same amount of money, just different convention for where the “,”‘s and “.”‘s go. e.g. moving the decimal place 3 places would mean if you had 1.00000 before, now it shows it as 1,000.00.
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