Bitcoin will be inflating the monetary base at about 6.25% APR around January of 2013, and continuing to fall at a very predictable rate. It’s not fluctuations that are hell on an economy, but unpredictability. The values of fiat currencies around the world float compared to one another constantly, and no harm is done. I expect the value of a bitcoin to rise considerablely over the next year or two, but that is due to expectations of a growing user base. Once the ‘bitcoin economy’ begins to level off, something that I would expect before 2013, the fluctuations of the relative value of a bitcoin will settle down.

Let’s say we now have a thousand users of bitcoin (just an arbitrary figure – I don’t know how many there actually are) so bitcoin’s extant coins serve a thousand users. Up that to a million users. What does it do to your prices, if you sell in bitcoin denomination? Then again up that to a hundred million users. There are tremendous changes in the value of each coin.

That may be good for those having produced the first coins, they can now buy a luxury mansion for what ten years ago just bought a good meal, but it is hell on a market place. A currency – even one as smart as bitcoin – should allow reasonable price stability.

Of course you can sub-divide the coin Creighto, but why should we have to?