Hacker News Reader

Comment by tromp | Hacker News Reader

> Unfortunately, this aspect of his brilliant design was one of the first things to be undermined by subsequent blockchain operators. Many cryptocurrencies that have been created since are unlimited in supply, including some of the most heavily speculated ones like Solana, Dogecoin and Shiba Inu.

> This is worse than what the central banks have done.

No, it's not. Even a coin that is emitted one per second forever is disinflationary. Not only is the yearly supply inflation rate perfectly predictable (unlike fiat), it also steadily converges toward zero (again, unlike fiat). In the long term, the difference between finite and infinite supply is negligible as long as the yearly supply never increases [1].

[1] https://john-tromp.medium.com/a-case-for-using-soft-total-su...

View on HN

Yeah, that one in particular was a pretty bad take. Who cares how many shitcoins people create? Just ignore them. That's like me claiming that the stock market has been undermined because people can start an unlimited number of companies.

It is a good take but it doesn't apply to random L1 currencies. It applies to L2 scaling layers with poor interoperability. Bridges create a wrapper of the bridged token. Once you have multiple bridges the ecosystem is fragmented. This means bridges and L2 scaling are a dead end.

Even if a single crypto coin is limited in supply, there's an infinite number of (potential) suppliers of coin.

Less than a hundred [1] that are not copy-pastes of prior projects with some irrelevant tweaks, which can for the most part be ignored.

[1] https://docs.google.com/spreadsheets/d/1geg5HHgDO-ht0u6CSTHp...

If I print a trillion schrute bucks, have I devalued the US dollar? If I print another trillion schrute bucks, does the US dollar suffer inflation, or does the schrute buck?

Yes people can make an infinite number of currencies, but they are all parallel systems. Making a new coin doesn't inflate the supply of bitcoin, it is just one more thing that bitcoin could potentially be exchanged for. And in practice it seems unlikely that more than a few thousand could be adopted by enough people to have a value appreciably different from zero.

Indeed, there are tens of thousands of various coins created, but 74% of wealth stays in just two of them - Bitcoin and ETH (if we exclude centralized tokens USDT, USDC, XRP, BNB etc). It's something like geometric series.

Reply on news.ycombinator.com