Structurally, Bitcoin is a lousy idea for a currency as it is intrinsically deflationary (i.e., even without the speculative inflating of the cost of a Bitcoin, the structure of the coin is such that coins become increasingly scarce and expensive as time goes by). You do not want this in your currency. The ideal is a low-level of inflation which provides an incentive to spend sooner rather than later. With a deflationary currency, the incentive is to put off purchases as long as possible as your currency will buy more tomorrow than it does today. Deflation ends up being economically disastrous, as Japan’s battles with deflation over most of the twenty-first century have shown.
This is why, aside from speculation, purchase of illicit goods and ransom payments, Bitcoin has had little traction as a currency.
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