Bitcoin has an odd meme where people who lose significant amounts of money are praised for their contribution to scarcity. The world is a zero sum game, and if you burn your bitcoins then my own coins are worth more!

Many Bitcoin citadels will have a monument to the brave hodlers of last resort who, purposefully or not, made their bitcoins practically unspendable for the economic benefit of the network. Take your families to visit the Tomb of the Unknown Privkeys and pay your respect. https://t.co/A33Rsj8YoU

— Michael Goldstein (@bitstein) October 18, 2019

The greatest tragedy for any Bitcoin HODLer is to outlive his bitcoins. But you know what’s even more tragic? Having your bitcoins outlive YOU.

In the late Middle Ages, material wealth had a way of outliving its HODLers. The bubonic plague wiped out at least a third of the European population, with the death toll as high as 80% in places like Tuscany. As people died off, gold and silver consolidated into fewer hands and per capita wealth increased. At the same time, lack of farm labor led to poor harvests and higher prices. Mass inflation ensued.

Human labor was the biggest source of capital in the Middle Ages; today fiat is the biggest source of capital. Bitcoin-as-a-deflationary-asset assumes the continued growth of the economy, but this assumption is already false. Labor productivity hasn’t grown in a decade, and our ongoing asset price inflation has been largely the result of financialization.

The impending fiat collapse won’t directly kill off any humans, but huge amounts capital will vaporize. People won’t be fleeing into bitcoin; they’ll have nothing to flee *from*.

After the Black Death, it took a couple generations for demographic restructuring to lead to new economic growth. People shifted from agriculture to pastoralism, which was a less labor-intensive use of land. And the Bitcoin carnivory rabbit hole is endless.