Why does one have to be zealous to understand bitcoins are divisible up to eight decimal places? A single bitcoin is really 100,000,000 bitcoin "satoshis" (1.00000000). "Satoshis" being the smallest unit (0.00000001).
So, there really are 2,100,000,000,000,000 bitcoin units. When you purchase a single "bitcoin", you really are purchasing 100,000,000 "satoshis".
Gold is also divisible into arbitrarily-finite (down to the atom, one would suppose, though that doesn't exactly seem practical...), but that completely misses the point of the article: that the money supply isn't large enough, so Bitcoin, like gold, becomes a store of value and is useless as a currency.
How easily can one spend an atom of gold? I can spend a handful of satoshis while sitting on the couch with my laptop.
>but that completely misses the point of the article: that the money supply isn't large enough
It seems you misunderstood my point, which is that bitcoin is not "21 million coins". There really are many more units, with the option of increasing the divisibility past eight decimal places in the future.
> There really are many more units, with the option of increasing the divisibility past eight decimal places in the future.
You are still missing the point. It is not divisibility that makes bitcoin unsuitable as a spending currency, it is the fact that its price keeps rising. Imagine if you are presented with two coins one that historically inflates and another that deflates and are asked to spend one and hold the other. Which do you pick? An inflating coin will always replace a deflating one as a medium of exchange. This is called Gresham's law.
A coin with a fixed supply will never be suitable for daily transaction because the demand for currency isn't fixed (due to economic and population growth).
NO it is not. Inflation does not mean growing money supply. It means money supply growing faster than the real economy that transacts on that money. Bitcoin money supply may be growing but not fast enough to accomodate the demand. So it is deflating.
> money supply isn't large enough, so Bitcoin, like gold, becomes a store of value and is useless as a currency.
This isn't true though, the supply of the money has no relation to whether or not something becomes a store of value. The key attribute is that it's finite (deflationary).
However, I need to say that a finite currency isn't deflationary forever, it can only be deflationary until there is no more demand for the currency, which has to happen at some point, then the currency becomes stable and mature.
The money supply is important as well, bitcoin is infinitely divisible (easy network upgrades possibly required) so for all practical reasons money supply (liquidity) will never be a problem for bitcoin, but it has been a problem for every single currency which came before. Gold especially because it's expensive to deal with changing and re-issuing the money supply each time you want to add liquidity.
Today, it's much easier with digital banking but liquidity is still not 100% all the time so when liquidity needs to be added or removed, it's done in unnatural ways, which leads to instability in markets.
That's about where the metaphor ends. While dividing gold down to atoms requires a great amount of mechanical effort, dividing btc requires a few more pushes of the '0' key (or configuring your client to use satoshis as the base amount).
The thing you have to remember though is that the velocity of Bitcoin or any cryptocurrency is higher than that of normal fiat. We could still have a finite supply of coins that acts as a currency.
Bitcoin can be destroyed, but in theory the limit never increases. Thus, Bitcoin will fail given a long enough time-frame eventually there will be less than 1 bitcoin left in circulation.
Granted, most currency's don't last all that long, but their are not enough accuracy to last say 20,000 years.
Bitcoins (the unit, not the currency) can indeed be destroyed by using OP_RETURN. This has been done in the past, and is still being done right now.
It is however highly unlikely that all 21 million bitcoins will end up in that drain.
Bitcoin can also be sent to an address of which there is no known private key. Future advances/exploits of Elliptic curve cryptography should make those coins recoverable.
In the end, users will probably not even know each other's public keys for everyday spending of bitcoin. They will only check the public keys for large purchases such as houses, cars, etc.
Does anyone outside of the most zealous ideologues really believe this?