this post was submitted on 21 Aug 2023
5 points (100.0% liked)

Memes

45886 readers
1413 users here now

Rules:

  1. Be civil and nice.
  2. Try not to excessively repost, as a rule of thumb, wait at least 2 months to do it if you have to.

founded 5 years ago
MODERATORS
 
you are viewing a single comment's thread
view the rest of the comments
[–] [email protected] 2 points 1 year ago (1 children)

You are clearly knowledgeable about the things you're talking and made a conscious decision. It seems like we agree that there is some risk, but you consider it insignificant while I it's quite substantial. Only time will tell whose right.

Monero's inflation is not a percentage, but rather a fixed 0.6XMR per block. This mean as the supply grows, the inflation percentage will slowly go down, so there's no exponential losses like with fiat inflation. Currently the 0.6XMR/block work out to 0.9% of the mcap, in the year 2100 it will be down to 0.5%: https://moneroj.net/tail_emission/ (<- great site btw, it has a few BTC diagrams as well). The tail emission was chosen so that it works out to be less inflation then gold, but high enough to have a decent security budget.

[–] [email protected] 2 points 1 year ago (1 children)

How do we know that 0.5% is decent? Why not 10% or 0.01%?

[–] [email protected] 2 points 1 year ago (1 children)

The more the better for security, the upper practical limit is golds inflation rate, the lower practical limit is the percentage of coins that become lost or inaccessible. That puts the viable range to 1.5-0.2%, roughly. To be clear, I'm not worried about bitcoins current rate, but rather that it will drop further and further.

[–] [email protected] 2 points 1 year ago (1 children)

Would I be correct to assume gold sets the upper limit because any higher and people would just store value in gold instead?

Why does the security budget need to be higher than the rate of lost coins?

[–] [email protected] 2 points 1 year ago

The goal is to create attractive market conditions. Positioning yourself between the historic store of value and the minimum to avoid deflation seems like a good target.