If You Expected Bitcoin to Mimic Gold, You Haven't a Clue About Gold
realclearmarkets.com
realclearmarkets.com
That's just absurd. Gold is a very useful commodity and a great store of value, but its value is no more constant than anything else. If gold's price were perfectly constant, futures contracts for gold would have much less exciting price movements, as the only input to the future price would be the amount of inflation vs the cost of storage, both of which are much easier to forecast than gold price movements.
That would take about 70 years to get yearly supply inflation lower than gold, something that Satoshi apparently wanted to see happen in just 12 years. Along with capped supply for better FearOfMissingOut...
Linear emissions are a security tax paid for by investors. Do investors enjoy paying this tax? Investors generally don’t “enjoy” being debased through inflation.
Ethereum got away with having no defined emissions policy early on, but they pulled it off during an era when information was low and ignorance was widespread. Many of their investors assumed Ethereum had a fixed supply just like Bitcoin did — and they had to scramble to rectify this years later.
“Governed emission” is achievable via systems of on-chain governance. Non-stakers get debased by tail emissions measures voted in by stakers. Stakers profit from the inflation measure or are hardly debased at worst.
While antithetical to gold, it achieves the stated goal of incentivizing ongoing chain security while also benefiting investors, particularly assuming staking yield is widely accessible to all in a decentralized manner.
The amount emitted at any time is not only finite, but limited by time, with the yearly supply inflation going down toward 0. There's no essential difference with a capped supply [1].
[1] https://john-tromp.medium.com/a-case-for-using-soft-total-su...
#!/usr/bin/env raku
use v6;
multi sub inflate($n, $r, $y)
{
my $m = $n;
loop (my $i = 0; $i < $y; $i++)
{
$m = inflate($m, $r);
}
$m;
}
multi sub inflate($n, $r)
{
$n * (1 - $r);
}
sub MAIN(:$rate = 0.0003, :$years = 100)
{
my $purchasing-power = 1;
my $inflate = inflate($purchasing-power, $rate, $years);
my $output = qq:to/EOF/.trim;
After $years years of inflation at a rate of {$rate * 100}% per year,
purchasing power is {$inflate * 100}% of what it was initially.
EOF
$output.say;
}
Expanding the supply on demand through on-chain governance in a way stakers can profit from, while sacrilege to “digital gold”, would be more palatable to me than rates of tail emission higher than 0.03% or so.