On Friday, I actually paid for something with Bitcoin for the first time in my life. I bought a beer, and I was really excited to just go through the motion of scanning the QR code and all of that good stuff. It was just so smooth and delicious.
I drank the beer. Then, I wanted another one. But then, I realized “hey, I don’t wanna get rid of my BTC!” What if it goes up 10 % tomorrow? I’d rather get rid of this fiat money, the future value of which I am … well absolutely not certain, but it sure as hell ain’t gonna be higher.
So I went ahead and bought another beer, but this time I paid with regular fiat money. It was as a blast using Bitcoin that one time, but I look at this stuff as a long-term investment. I wanna keep it!
Then it struck me, isn’t this simply Gresham’s law kicking in? The law that says bad money will drive out good money from circulation.
I would much rather spend my fiat money than BTC, even if BTC payments had become available everywhere.
Well, maybe not if I thought BTC would go down in value. But who believes that, right?
So, I assume we all would enjoy seeing mainstream adoption of Bitcoin. However, is there not this giant mechanism in the way, which is Gresham’s law?
As long as fiat money still exists, you would think people generally would much rather spend that in their daily lives and save their Bitcoin. That’s kind of why people spent fiat money to purchase Bitcoin in the first place.
Let me know what you think.